NEW YORK Spot ferroalloy trading continues to be scant as long-term contracts cover the majority of business, with one trader claiming that the market has entered an early summer slowdown.
High-carbon ferrochrome dropped to a range of 99 cents to $1.02 per pound from $1 to $1.03 previously, with transactions confirmed at below $1 per pound. Ferrosilicon also dropped and is now trading in a range of 91 to 93 cents per pound, down from 92 to 94 cents.
Most traders contacted by AMM said that few spot inquiries, let alone purchases, were being made by consumers.
"Were all a bit worried already. Theres been no steady business for almost five weeks," one trader said.
A second trader said that few customers are compelled to enter the spot market as even contracted material exceeds their requirements. "The summer slowdown has come a little bit early," he said. "I think until September it will be slow and tough. Whatever business is out there everyone will jump on, so I can foresee prices coming down a lot more."
However, one molybdenum producer source told AMM that the slow spot activity isnt indicative of intrinsic market weakness, and things might actually pick up this summer. "Though theres a dearth of spot activity, we dont have a lack of strength in the market. At least three of our customers are doing rather well," he said. "Even though its now early May, I dont think its correct to say the third quarter will definitely be slower."
One ferrosilicon trader also forecast a possible improvement in spot trading activity mid-year. "We dont expect to see more inquiries over the next six weeks before mid-June, at which time some of the medium-sized consumers who are not tied to full-year contracts will come out for third-quarter material," he said.