India: Ferro-chrome prices stabilize ahead of Chinese purchase tender outcome
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Indian ferro-chrome prices have been down-trending since past week. However, the fall has paused despite increasing selling pressure before the release of Chinese purchase tenders. There is a bearish sentiment in the market, with fears that the tender prices might go down, owing to the lacklustre stainless-steel market. Most of the domestic manufacturers in India sold ferro-chrome to China, either directly or through merchant exporters due to higher demand and better prices in May and early June post the release of tender prices. However, now the demand from China remains absent and the domestic market is yet to pick up.
Current Assessments:
The prices for Ferro Chrome assessed by SteelMint are as follows:
Ex-Jajpur: INR 64,500 - 65,000/t,
CNF China: cents 68/lb,
CNF Japan: cents 71/lb, and
CNF South Korea: cents 70/lb.
Chinese Market:
Today is the last working day in China, before the three days Dragon Boat festival holidays. Due to the holidays, the major stainless-steel mills did not release the HC ferro-chrome prices, though expectations for price cut are high. However, the situation might be beneficial for the Chrome ore market, as the inventory in the Chinese ports are being consumed at a high pace and the incoming cargoes are limited.
South African Chrome Ore:
The prices of Chrome ore dipped this week owing to the lack of transactions and down trending ferro-chrome market in China. The Chrome ore market softened since last week due to continuous downstream alloys market. The lack of willingness for procuring ore indicates high inventory of ferro-chrome and a shared interest of delaying transactions till the next months tender prices are released and the market situation is clear. Market participants believe that the prices are getting into negotiable levels due to improved logistics from South Africa.
Outlook:
The prices of ferro-chrome might remain stable for now, but the tender prices next week will play a major role in the future trend of the market. Meanwhile, the geopolitical tensions are also creating further worry among the Indian producers.
