GLOBAL CHROME WRAP: Chrome markets little changed, await China return

Global chrome markets were little changed over the past week amid quiet trading conditions due to the absence of Chinese market participants, who took a week-long break to commemorate their country’s National Day.

Asian markets stable amid China shutdown
Prices of ferro-chrome cargoes for delivery into Japan and South Korea were assessed as stable in the past week as Indian producers held their offer prices at $1.04-1.05 per lb. Chinese trading was inactive due to the country’s week-long national holiday.

Several Japanese trading houses told Metal Bulletin they had received offers from Indian producers for cargoes, loading in October, at $1.04-1.05 per lb cif main Japanese ports (MJP). One Japanese trader countered these offers with a firm bid at $1.00 per lb for 110 tonnes, but has had no response yet.

Another Japanese trader said that the bid at $1.00 per lb cif Japan was a difficult sell because of a tightening supply situation – which is expected to worsen within the next few weeks.

“Japanese buyers are concentrating on the closing of their fiscal year books and settling fourth quarter contract volumes. However, we are expecting to see spot buying activity pick up in the coming weeks. I expect buyers to be able to come to terms with $1.03 [per lb cif MJP],” the second trader said.

Buyers from South Korea were unavailable for comment due to domestic public holidays from October 4-9. Several Indian producers contacted by Metal Bulletin said that they have put firm offers with Japanese and South Korean buyers at $1.04-1.06 cif MJP and cif Busan. Two Indian producers said that they were unable to conclude deals with South Korean trading houses, due to the former waiting for Posco to disclose its tender results in mid-October.

Three other major South Korean buyers have not yet released purchase tenders. Dealers are expecting these buyers to release their buying requirements in late October.

Chinese domestic spot ferro-chrome prices were last recorded at 8,100-8,400 yuan ($1,218-1,263) per tonne on September 29, down from 8,300-8,500 yuan per tonne the week prior. A downward trend had developed in September because of a weaker Chinese stainless steel sector, a key consumer of ferro-chrome.

Metal Bulletin’s latest price quotation for contract prices of Chinese domestic high-carbon ferro-chrome (6-8% C, basis 50% Cr) was rolled over at 8,200-8,400 yuan per tonne, based on major Chinese stainless steel mills’ tender prices for October.

Metal Bulletin’s UG2 chrome ore index, cif China, was flat at $227 per tonne on October 6, while the charge chrome index, which tracks South African imports to China, was unchanged at $1.04 per lb.

European market moves slowly
European chrome and ferro-chrome markets were little changed in the past week, with spot trading quietened after the benchmark settlement for the fourth quarter. The week-long Chinese holiday also dulled trading activity as China is a key export market for South African suppliers.

The one active market was refined ferro-chrome, where 0.10% grade widened at the lower end of its price range. Metal Bulletin’s latest price quotation for spot low-carbon ferro-chrome (0.10%) stood at $2.15-2.30 per lb on October 6, compared with $2.20-2.30 previously. High-carbon ferro-chrome was steady at $1.25-1.40 per lb.

The European Commission’s anti-dumping investigation into imports of low-carbon ferro-chrome to the EU from China, Russia and Turkey, which started in June, is influencing European and other international markets, sources said.

The product being investigated is ferro-chrome that contains by weight more than 0.05%, but not more than 0.5%, of carbon, the Commission said.

“In expectation of the [EU] anti-dumping duties, traditional spot buyers are staying away from Turkish and Russian material,” one supplier source said.

“We have recently concluded new contracts with traditional spot buyers of Turkish material … in expectation of anti-dumping duties being retroactively applied, as well as on future transactions.”

“Given the market deficit in low-carbon ferro-chrome units, end-users do not want to take a chance on relying on those parties listed in the anti-dumping case for their 2018 consumption needs,” the source added.

US market edges higher

The US high-carbon ferro-chrome market edged up in the past week in line with increased spot market activity.

US spot prices for high-carbon ferro-chrome were reported at $1.42-1.48 per lb on October 5, up 3 cents on the high end of the range, according to Metal Bulletin sister publication AMM’s latest assessment.

Increased market activity follows a slow September, although there is little trader confidence that current spot business conditions can persist.

Prices should be strong through the current quarter due to the alloy being concentrated in relatively few suppliers, according to dealers.

“The market is consolidated, so suppliers can control and regulate it a bit more,” one supplier source said.

*Note: Due to Chinese markets being closed for the country’s National Day Golden Week holiday, there is no Chinese market commentary in this week’s global chrome wrap. Metal Bulletin’s assessment of Chinese ferro-chrome and chrome ore prices have been rolled over for the week ending October 6 in accordance with our holiday pricing schedule.