Indian Ferro Chrome Market in September 2022
Indian ferro chrome prices remained range bound last month, recording a marginal drop of just 1% m-o-m to around INR 94,000/t ex-works-Jajpur. This was due to moderate demand in the domestic market.
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Prices hit rock bottom in 2022 during early September amid falling export offers due to weak demand as Chinese buyers sought the material at a lower price. However, domestic prices started improving in mid-September amid good inquiries as some major stainless-steel producers increased production, mainly for the 200 series due to high demand during the festive season. As a result, ferro chrome producers shifted to selling in the domestic market. Meanwhile, buyers started booking to stock up inventory after realising that prices have bottomed out.
The up-and-down trend in the ferro chrome market has kept prices range bound in the month.
Furthermore, ferro chrome smelters’ prediction about a recovery in the market has also come true following a positive response to OMC's chrome ore auction on 19 September. At the auction, 9.000 t of South Kaliapani's high-grade material was booked at a premium of 6-8% over the base price, while 24,100 t was sold at the base price.
Now let’s see how did the imported chrome ore market pan out in September.
Imported UG2 chrome ore prices into China, which is a benchmark for India’s imported chrome ore market, fell by 6% m-o-m in September. China’s domestic chrome ore market was affected by the drop in shipping costs and the decline in international prices. The monthly average prices of UG2 ore were at around $203/t while the monthly average prices of Turkish-origin chrome ore were at around $306/t CNF China, down 9% m-o-m in September.
So, the downtrend in imported prices capped a sharp hike in Indian ferro chrome prices in September.
Outlook
Ferro chrome smelters in India are optimistic that the market will remain supported by the increase in stainless steel production during the festive season.
Furthermore, market participants expect good demand in the near term as end users try to restock the material before the Diwali holidays as transportation gets affected during the festive time. This is offering some hope for the future.
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