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Chinese high-carbon ferro-chrome price gains on improved sentiment

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Chinese ferro-chrome producers have raised offer prices since last week on steady May purchase prices from major stainless steel mills.

On Tuesday, spot prices for high-carbon ferro-chrome rose to 7,700-7,800 yuan ($1,218-1,234) per tonne after producers raised their offer levels by 100 yuan to 7,700-7,900 yuan.

“Smelter confidence obviously increased after Baosteel and Jiuquan Steel announced flat prices for May. Most smelters have around 300 yuan profit at that [7,650 yuan] level,” a Shanghai analyst said.

At the end of last month, Baosteel and Jiuquan Steel both kept their May prices for high-carbon ferro-chrome unchanged from April at 7,650 yuan per tonne, including delivery.

“It encourages smelters to return to the chrome ore market, pushing up the prices of chrome ore,” a trader in Ningbo, Zhejiang province, said.

Spot prices for chrome ore gained by around 1 yuan per mtu recently, with South African 42% powder at 35-36 yuan per mtu and 44% powder at 38-40 yuan per mtu, traders told Metal Bulletin.

Many market participants are still waiting for the May price from Taigang, China’s largest stainless steel producer, to get a clearer picture of market developments.

“Taigang still hasn’t set its offers yet. I think its price will be around 7,500 yuan, slightly higher than its April price on the current improved market environment,” a smelter in Sichuan province said.

“The market may rise again if Taigang’s price is high. But in the long-term, the recovery will be not be strong, as downstream stainless steel demand remains less than robust,” a Shanghai trader said. 

editorial@metalbulletinasia.com

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