Search Copying and distributing are prohibited without permission of the publisher
Email a friend
  • To include more than one recipient, please separate each email address with a semi-colon ';', to a maximum of 5

  • By submitting this article to a friend we reserve the right to contact them regarding AMM subscriptions. Please ensure you have their consent before giving us their details.

Ferroalloys put steelmakers at mercy of global market

Keywords: Tags  ferroalloy market, US ferroalloys market, U.S. Geological Survey, China ferroalloys,

There has been a continuing decline in ferroalloys production in the United States during the past decade, even as overall global output has increased, according to the U.S. Geological Survey (USGS). 

The North American decline can be attributed to a number of factors, including the shift of ferroalloys production to ore-producing countries, the USGS said. This trend was clearly observed by the 1980s, but U.S. production began to decrease as early as 1970 and imports subsequently rose. 

Increased global competition appears to be the primary reason for the decline of the U.S. ferroalloys industry. As a result, North American purchasers of ferroalloys are much more at the mercy of the global market, which is moving dynamically in 2012.

Demand has been spreading to the ferrosilicon and ferromanganese markets as buyers try to buy silicon and manganese units in alternative forms, one trader said.

But another trader said that while the market was relatively tight, he didn’t think the situation had worsened significantly recently. “There is definitely tightness and I don’t see the price going down anytime soon. But I don’t think it’s as oversold as people have said. I wish it was,” he said.

China’s molybdenum output could fall this year as a weaker steel market keeps prices low, according to an executive at Jinduicheng Molybdenum Group Mining Corp. (JDC Molybdenum), China’s largest producer. “Miners will inevitably face losses or low profits with the increased resource taxes and other costs rising,” Nick Cao, vice general manager of JDC Molybdenum Marketing Co., told delegates at an Asian ferroalloys conference in Hong Kong earlier this year. China’s domestic prices failed to move notably higher even after the government increased resource taxes on mining earlier this year, he said. “We expect production this year will drop or growth will slow down,” Cao said. “The Chinese market is full of uncertainties, so it is hard to say how much (molybdenum output) will decrease. We estimate that China’s demand growth will also decrease this year, in line with the lackluster downstream market.” 

Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.