India: Ferro chrome prices rise to two-month high amid supply constraints

Indian high-carbon ferro chrome (HC60%, Si:4%) prices increased by INR 2,000/t ($24) w-o-w in comparison to the previous assessment on 20 December. Because there was a shortage of material in the market and a significant number of inquiries, prices increased.

As per SteelMint's assessment on 27 December, high-carbon ferro chrome (HC60%, Si:4%) prices stood at INR 110,300/t exw-Jajpur. The assessment has risen to around a two-month high as similar levels were last seen in beginning of November, 2023. Around 1,700 t of deals were finalized in the price bracket of INR 110,000-111,000/t.

Furthermore, on 28 December, the price of high-carbon low-silicon ferro chrome (HC 60%, Si: 2%) increased by INR 2,650/t w-o-w, to INR 118,800/t exw-Jajpur.

State of the market

Supply chain impacted due to production cuts: With the falling prices over previous weeks, many producers were unsure of the market's trajectory and opted for production cuts amid reduced profits. Additionally, the market saw limited supply as nearly 6-7 key players were either overbooked or had restricted offerings. However, post OMC's and FACOR's auction, producers began to quote higher offers and with demand in the market, prices increased.

Stable Chinese offers: Ferro chrome (HC60%) prices in China stayed stable w-o-w at RMB 8,850/t ($1,252/t) exw-Inner Mongolia. Tsingshan also kept its tender prices flat m-o-m at RMB 8,495/t ($1,202/t) for January 2024. Because of the market's volatility, most manufacturers preferred long-term contracts over selling their material in the spot market.

Stainless steel context: Stainless steel prices for 304 fell by INR 3,000/t w-o-w to stand at INR 175,000/t exw-Mumbai. The market remained slow due to little purchasing activity. Ferro chrome costs are still significantly influenced by this sector.

Outlook

Considering the ongoing market conditions, prices may go up a little but are expected to stay within the current range.