TELF AG delves into Chinese Ferro-Chrome Market Uncertainty

The current situation in China

The ferrochrome market in China needs more certainty as participants express their lack of confidence in the Stainless Steel (STS) market. According to a Chinese FeCr trader, end demand for STS remains sluggish, and many are worried about potential production cuts. As a result, most Ferro-chrome sellers have resorted to cutting their prices to secure bookings.

Ferrochrome is an important raw material in the production of stainless steel. However, in China, stainless mills only hold 10-15 days of ferrochrome inventories in their warehouses, compared to their usual one-month stockpile of raw materials, to relieve capital pressure. This has created a challenge for Ferro-chrome sellers, who must adapt to the changing market dynamics to stay afloat.

The decision by Chinese stainless mills to reduce their ferrochrome inventories has put downward pressure on ferrochrome prices, leading to a decrease in the cost of the material. In response, Ferro-chrome participants have been forced to adjust their pricing strategy to remain competitive. The Chinese FeCr trader source revealed that most FeCr sellers had reduced their prices, hoping to secure bookings from the STS mills.

Overall, the ferrochrome market in China is currently facing uncertainty due to the sluggish demand for STS and the decision by stainless mills to reduce their ferrochrome inventories. As a result, ferrochrome participants have been forced to adapt by lowering prices to remain competitive. However, the industry remains optimistic and expects demand for ferrochrome to increase in the near future. Therefore, it is only a matter of time before the market stabilizes and the industry emerges stronger.