India: Ferro chrome prices spike amid reduced supply

Indian ferro chrome prices surged amid reduced supply and increasing export demand. The Russia-Ukraine war has increased demand for ferro chrome mainly from Europe and Japan, which boosted prices.

According to SteelMint's assessment on 9 Mar'22, most of the domestic deals were concluded at around INR 125,000/t ex-Jajpur.

Buyers fear further price hikes due to supply shortages following Russia's invasion of Ukraine, and, taking advantage, producers have sharply raised their offers. Currently, Indian ferro chrome producers are not offering below INR 130,000/t in the domestic market

Market highlights

• The European and Japanese markets remained active for Indian producers as Russian supplies have evaporated from the market. Ferro chrome prices in Europe have also risen alongside soaring energy prices. Consequently, European interest has shifted to Indian material, resulting in a surge in inquiries and higher ferro chrome prices.
  
  
• In addition, a rise in ferro-chrome prices was also partly fuelled by the rally in nickel, with reports suggesting that buyers turned to increasing ferro chrome procurement before nickel spiked further. This has also contributed to a rise in ferro chrome prices.
  
  
• Furthermore, Vedanta's ferro chrome auction received overwhelming response in the domestic market last week. This encouraged other smelters to raise their offers in domestic and export markets as well.
  
  
• Among other things, the chrome ore market returned to its upward trend, supported by increased liquidity as supply disruption also led to a rise in chrome ore prices. Overall, a combination of strong demand and low stocks at Chinese ports have pushed up prices.
  
  
• Additionally, ferro chrome prices are gaining support from stainless steel prices, the main downstream sector for ferro chrome, which was boosted by surging nickel prices.
  
  

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