Chinese domestic spot prices of high carbon ferrochrome (50% basis Cr) remained steady at Yuan 6,850-7,000/mt (equivalent to 84-86 cents/lb) delivered with value-added tax on Wednesday on little change in market fundamentals.
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Domestic prices had already fallen by Yuan 100-150/mt in late-July in response to low bid prices from major Chinese stainless mills for their August deliveries, and most industry observers expect prices to remain stable in the near term until mills set their September purchase prices in late-August.
A trader in north China said she had some difficulties securing material for prompt delivery as factories are now producing according to orders received while keeping inventory levels low. But most maintained that supply remained ample in the market.
Meanwhile, a Chinese mill had procured around 5,000 mt of South African charge chrome (48-52% Cr) at 84 cents/lb CIF southern China, while deals of 500-1,000 mt of Indian-origin ferrochrome (58-60% Cr) were closed at 85-86 cents/lb CFR Shanghai this week.
Market participants said some traders and mills are opened to buying at these prices as they are close to current domestic price levels.
However, most said that deals for imported materials are generally still hard to close as Chinese buyers have sufficient inventory or are seeking lower prices at around 83 cents/lb CIF/CFR China, a level to which suppliers are still reluctant to drop.
"Prices could drop to 83 cents/lb soon but there is little room for prices to drop further thereafter. When the summer holidays are over in Europe, prices could start firming in September," a Shanghai-based trader said.
The stainless steel industry is the largest consumer of ferrochrome.
--Vivian Teo, email@example.com
--Edited by Jonathan Dart, firstname.lastname@example.org