Indian ferro chrome market in wait- and-watch mode before China reopens

The Indian ferro chrome market is now eagerly waiting for China to return from its Golden Week holidays. Major market participants remain perplexed about the increased prices in China and how the country would control the same.

Although there is increased anxiety amongst the major ferro chrome producers in India regarding the situation in China, prices have increased significantly in the domestic market. Indian ferro chrome offers are at INR 140,000/t, while deals have been concluded at rates between INR 135,000-138,000/t for various lots.

Indian ferro chrome supplies are restricted to some major producers while the rest have very limited material. The major producers are relatively strong in the exports market and expect to export bulk quantities as soon as China reopens.

Meanwhile, the exports market remained a little down and the South East Asian countries are also waiting for Chinese tender prices. Major stainless-steel mills have deferred their bids and might release them after their return. This has made the sentiments in the Chinese market a little unclear.

Foggy market before winter
The Chinese power shortage triggered the price increase in the Indian market with some green shoot of optimism. However, the power crisis in China is the worst in the past 20 years, and there are enough grounds to support the fact that the crisis is not improving of late. Thus, the power-intensive ferro alloys plants will keep facing production curtailments, which favours the Indian smelters.

However, the major concern for the exporters is that the Chinese government might want to control the prices and curtail steel production altogether, bringing down demand. Major stainless-steel mills were shut before the holidays and the remaining are still unsure about the policies being issued by the provinces, which is making it difficult for the stainless-steel mills to decide on their raw material inventory.

Outlook
Indian ferro chrome prices are expected to remain at higher levels on increasing production costs due to higher nut coke and export prices.