RESEARCH: Ferro-alloy prices poised for strong finish to year, further strength in Q1 2021

The latest forecasts from Fastmarkets’ team of analysts are ready to view.

Key ferro-alloy forecast highlights for the coming months:

• A strong recovery in both bulk and noble alloys is expected in 2021 but the markets are unlikely to return to the levels seen before the outbreak of the Covid-19 pandemic. We have seen a quicker-than-expected recovery across various regions amid the economic fallout of the pandemic, and expect to see a stronger recovery overall next year. China will continue to lead the economic recovery in 2021 due to various economic stimulus measures, while other nations will also enjoy the beneficial effects of government stimulus spending through 2021.

• With lockdowns and pandemic restrictions preventing consumers from spending on travel, experiences and services, consumers are instead increasing their spending on durable goods including cars, appliances and other steel-intensive manufactured goods, in a positive development for steel and ferro-alloy markets. If government stimulus also leads to infrastructure investment in the EU and the United States next year, this would be another positive development for steel and ferro-alloy alloy demand in 2021.

• News that South Africa’s government is considering imposing a chrome ore export tax broke just after the publication of our previous tracker, but has dominated discussion within the chrome markets since then. Above all, Chinese ferro-chrome smelters would be affected, given that they rely heavily on South African chrome ore – around 80% of China’s chrome ore imports during the past year have come from South Africa.

• There remain a number of uncertainties, however, regarding the proposed chrome ore export tax. Not least of these is whether an export tax will in fact be implemented – discussions of such a tax have been aired before only to amount to nothing. Second, there is as yet no indication about the level of any export tax, although most market participants expected that it would be in the range of 30-40%.

• For now, some of South Africa’s leading chrome ore miners and exporters are arguing against the move. Chrome mining and the export of ores has expanded over the past decade, while smelting of ferro-chrome has stagnated. Putting up the greatest opposition to any export tax are the platinum group metals (PGM) miners, which sell UG2 chrome ore as a by-product of their PGM mining, and generally have no downstream smelting capacity. This could be a crucial point, given the higher value of PGM mining to South Africa’s economy when compared with the chrome industry.

Click here to view the Ferro-alloys Market Tracker in full.

If you are not a subscriber but would like see a free sample report, please click here.

What to read next
The price of graphite flake fines in China continued to edge lower amid slow demand and a depreciation of the local currency in the week ended Thursday May 25. Spherical graphite prices in the country, meanwhile, held at the 11-year low reached in the previous session
The outlook for North American steel scrap prices has headed further into bearish territory ahead of June’s trade, with prices for all grades expected to fall again after a round of across-the-board decreases in May
Fastmarkets is inviting feedback on a change of publishing time for our ferro-chrome price in the Chinese domestic market as well as ferro-chrome import prices in Japan and South Korea, to 5-6pm Shanghai time from 2-3pm London time.
Fastmarkets is inviting feedback on a proposal change the publishing time for our silico-manganese, ferro-manganese and manganese ore port prices in China, to 5-6pm Shanghai time from 2-3pm London time.
Chinese lithium prices continued to trend upward over the past week, but at a slower pace than in previous weeks due to the emergence of bearish sentiment and resistance among consumers
The publication of Fastmarkets copper concentrates TC index, cif Asia Pacific was delayed on Friday March 26, due to a reporter error.
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.