INT'L FERRO-ALLOYS CONF: Ten things we learned

Here are ten things we learned at the 31st Metal Bulletin International Ferro-Alloys Conference in Prague.

Here are ten things we learned at the 31st Metal Bulletin International Ferro-Alloys Conference in Prague.

1. Bartering is back. Stainless steel mills, particularly in Japan, have been swapping stainless steel for ferro-chrome, rather than paying for the raw material in cash, chrome market sources told Metal Bulletin.

With no cash changing hands, the barterers need financing from a backer with deep pockets – and a strong Asian trading firm has stepped in to provide it.

2. Avas has launched an agency to market ferro-tungsten outside Russia on behalf of Wolfram Company. Fedor Mironenko, a director of Avas, described the arrangement as “extremely low risk”.

3. Fesil has restructured, centralising its operations in Germany and leaving sales offices in Luxembourg and Spain. Eleven staff were cut in Luxembourg as a result.

It has closed an office in India and will turn its office in South Africa into an independent partner company.

4. There will not be a “new China”. The world’s largest consumer of metals is not going to enter another phase of investment and development.

There are many reasons to be optimistic about India, but the demand-side response will not be of a scale sufficient to ease the malaise, according Simon Collins, head of business development at South32.

5. No demand-side recovery for the manganese industry is in sight, but production cuts will not be enough to ensure a sustainable recovery in prices, according to Gueorgui Pirinski, carbon steel materials analyst at Noble Group.

6. Malaysia is on the map for manganese alloy producers, with a good supply of mid-grade manganese ore and easy access to low-cost, renewable energy. New manganese ore and alloy projects are scheduled to come on-stream in the coming years, which could put pressure on prices and producers elsewhere. 

7. A temporary export ban on ferro-nickel imposed by Myanmar in September has stopped the Dagongshan smelter moving metal to its customers in China. The suspension of exports has been imposed while the Myanmar government renegotiates with the smelter how proceeds from sales will be distributed. 

8. Metalliage is ramping up instead of cutting back. The Canada-based alloys producer is building up production of ferro-titanium with a view to reducing its overheads and preparing for improved market conditions, board chairman Mohammad Rahbary said.

9. Oversupply is still a major problem for tungsten markets, especially from China. Excess production continues to be a drag on ferro-tungsten and APT prices in Europe, a trader said. There is more room to fall for both, and the best that can be hoped for is stability rather than improvement.

10. With prices seemingly beyond redemption in several markets, today’s priority is cutting costs, followed by diversification or a drastic rethink.

“We are working on our costs and making sure we don’t overlook markets where we don’t have share in already because previously we had enough customers,” one manganese supplier told Metal Bulletin. 

Ferro-titanium producers say they must find a way to survive, whether by finding a new product, investing in existing production and hoping for a recovery, or implementing major cutbacks.

Janie Davies 
jdavies@metalbulletin.com
Twitter: @janiedavies_mb

Charlotte Radford 
charlotte.radford@metalbulletin.com
Twitter: @Cradford_MB

Ellie Wang 
Ellie.wang@metalbulletinasia.com

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