India: Ferro chrome prices up w-o-w on good export demand

Indian ferro chrome prices increased w-o-w, despite lesser trade deals being clinched at the higher end of the spectrum as buyers refused to accept the steeper offers.

According to SteelMint, ferro chrome prices were hovering at around INR 101,200/tonne (t) on December 22, up by INR 3,700/t w-o-w. This week, approximately 2,500 t of transactions were recorded. More deals could have been done, but buyers' fear of a price drop made them hesitant to book material.

Factors supporting ferro chrome prices

• Good export demand: Indian smelters were receiving a large number of inquiries from the export market, which was a good sign because customers from other countries were eager to book the material ahead of the New Year holidays. Rising Covid cases in China had no effect on prices due to high demand. As a result, majority of the buyers were more focused on the export market. This also influenced sellers to quote higher prices in the domestic market, causing prices to rise slightly.
  
  
• Chrome ore prices rise: This week, the chrome ore market showed a slight recovery trend, amid favourable sentiments. But the actual trading volume remained stable. The chromium ore market is currently being driven by the rise in ferro chrome prices, and spot traders' bullish sentiments are at an all-time high. This boosted ferro chrome prices as well.
  
  

Outlook
Market participants expected a hike in ferro chrome prices in the near term amid hike in export demand.

The drop in stainless-steel scrap (316 series) prices w-o-w to INR 238,000/t exy-Delhi, however, restrained buyers from booking bulk quantities at higher prices due to weak demand. Furthermore, stainless steel scrap imports increased by 15% y-o-y in November, a factor that can limit any sharp rise in ferro chrome prices.