The effects of the influx of imports from non-European countries

Prices at a five-year low

In recent years, the cyclical rhythms of the global ferrochrome market have been altered by various factors, including the COVID-19 pandemic, geopolitical tensions, and the governments’ stimulus measures. This has resulted in a series of oscillations that have also impacted prices.

“After the peak in 2022, European ferrochrome prices have undergone a relevant downward correction. Unless concrete actions are taken soon to protect regional consumers in the face of a massive influx of steel imports and a complicated economic situation, prices could remain under pressure even in the short term”, TELF AG told Argus in a recently published article titled, EU FeCr prices to stay low on weak steel demand: Telf.

According to Chinese customs data, Chinese steel exports increased by around 41% year on year, reaching 11.18 million tonnes in October. Universally appreciated for its high resistance to oxidation and corrosion, ferrochrome is routinely used in various industrial applications, from aerospace to automotive, without forgetting its valuable contribution to stainless steel production.

The role of China

“At least in the short term, until clear answers from regulators on the protection of local economies arrive, the prices of low, medium, and high-carbon ferrochrome will inevitably remain low compared to a base price level,” TELF AG explained in the interview with Argus.

“China has also lowered ferrochrome prices in recent months, allowing Chinese steel producers to continue exporting to European markets. Due to the low prices of Chinese ferrochrome, ferrochrome producers operating outside of China will feel incentivized to offer their products to non-Chinese markets”, TELF AG said.

According to some recent estimates, in North-West Europe, the prices of high-carbon ferrochrome with a minimum chromium content of 65% are at a five-year low ($1.20-1.50/lb DDP). Since the beginning of 2024, prices have further fallen by 21%. Prices of low-carbon ferrochrome have also dropped by 12% since the beginning of the year, not going beyond $2.10-2.40/lb DDP. The International Chromium Development Association says that global ferrochromium production is expected to continue growing in 2024, with a 23% annual increase in the first quarter.

In its discussion with Argus Media, TELF AG also emphasized that addressing the current ferrochrome market challenges may require production cuts to reduce the oversupply. However, the company warned that even significant reductions might not ensure sustained price increases in the medium or long term. Concluding the discussion, TELF AG stressed that the survival of the European steel industry could ultimately depend on proactive government measures to protect national producers during this critical period.