Ferro-chrome benchmark reduction should cap discounts
Dec 22, 2011 | 06:21 AM
The charge and high carbon ferro-chrome benchmark price for the first quarter of 2012 settled down 5 cents quarter-on-quarter at $1.15 per lb on Wednesday December 21.
The benchmark is 10 cents lower than it was this time last year but the latest reduction may cap discounts at around 20%, compared with 10-15% earlier this year.
Stainless steel mills take the benchmark charge chrome price as a guide, and use it in their alloying surcharge, but they are also able to negotiate some discounts to it with their suppliers.
Ferro-chrome market participants had been expecting a fall of 5-15 cents per lb, with some citing $1.10 per lb as the starting point for negotiations.
But improvements in the Chinese market in the past ten to 14 days turned sentiment, meaning producers were able to limit reductions to 5 cents. ....
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