India: Ferro chrome prices rise to over 2-month high after key auction results

• Bids up from previous auctions in OMC's chrome ore, FACOR's ferro chrome auctions
  
  
• Tsingshan's October tender prices fall by RMB 400/t ($57/t) m-o-m
  
  

Indian high-carbon ferro chrome (HC60%, Si:4%) prices saw an increase of INR 2,900/t ($35/t) w-o-w as compared to the previous assessment on 18 September. Prices increased post higher bids at OMC's chrome ore and FACOR's ferro chrome auction.

Price trends

Uptrend in domestic prices: Indian high-carbon ferro chrome (HC60%, Si:4%) prices were INR 110,000/t ($1,314/t) exw-Jajpur, as per BigMint's assessment on 25 September. Approximately 500 t of spot market deals were reported last week in the price range of INR 109,000-111,000/t ($1,303-1,326/t) exw. Prices have risen to over two months high as these levels were last seen in mid-July, 2024, as per data maintained with BigMint.

Similarly, high-carbon low-silicon ferro chrome prices also went up by INR 2,300/t ($27/t) w-o-w to INR 115,700/t ($1,383/t) exw-Jajpur.

However, there was a drop of INR 3,100/t ($37/t) w-o-w in low-carbon ferro chrome (C:0.1%) prices, settling at INR 213,400/t ($2,550/t) exw-Durgapur. Around 200 t of trades were finalised for it within INR 214,000-216,000/t ($2,557-2,581/t) exw price bracket.

Slight drop in export offers: Export prices to China and Japan inched down by 1 cent/lb w-o-w each to 94 cents/lb CNF Tianjin and 99 cents/lb CNF Tokyo, respectively.

Market summary

Bids climb in recent auctions: 3 major auctions concluded in the domestic market in the previous week. OMC held auctions for both chrome ore and ferro chrome. On the other hand, Vedanta-FACOR conducted ferro chrome auction. At OMC's chrome ore auction on 20 September, 22,400 t were sold out of 32,400 t offered. Bids went up by 6-21% m-o-m for below 50% grades and were stable m-o-m for higher than 50% grade. Additionally, premiums climbed 17-71% over the base price. Meanwhile, in their ferro chrome auction on 24 September received subdued response as only 1,150 t got sold out of 4,650 t. Bigger lot closed at INR 106,868/t ($1,277/t) exw, almost similar to the base price.

FACOR's auction on 21 September got concluded at INR 108,500/t ($1,297/t) exw, up by INR 1,500/t ($18/t) against the last auction.

Producers raise offers post higher bids in OMC's chrome ore auction: Following auction results, offers from some producers went up to INR 113,000-117,000/t ($1,350-1,398/t) exw levels. However, tradable prices remained up to INR 111,000/t ($1,326/t) exw as majority of the buyers were cautious of the immediate hike in offers and wanted to wait for some days regarding price clarity.

A major domestic buyer said: "Our bid prices are low due to a decline in Chinese tender prices and reduced bids in the stainless steel sector."

China's market witnesses trend reversal: Ferro chrome (HC60%) prices in China declined by RMB 200/t ($28/t) w-o-w to RMB 8,400/t ($1,197/t) exw-Inner Mongolia. Weak demand and surplus production weighed on prices. This led Tsingshan to reduce its tender prices for October by RMB 400/t ($57/t) m-o-m to RMB 8,295/t ($1,182/t) DAP, including taxes. Additionally, reports indicated that Tsingshan had enough inventories as well.

Stainless steel market remains stable: Stainless steel prices of 304 grade HRC were unchanged w-o-w at INR 182,000/t ($2,175/t) exw-Mumbai. No major movement happened in this sector and with upcoming festive season, trading activities might remain on the lower side. LME nickel prices may also experience some variations.

Outlook

In the days ahead, buyers' acceptance will determine the price trajectory as offers have already gone up.