TELF AG Ferro-alloys Market Rehash – September 8, 2023
A noticeable surge
The ferro-alloys market witnessed a noticeable surge in chrome ore prices back in week 35 of 2023. The UG2/MG index observed an increase of 2.4% last week, settling at 301 USD/MT. This marks the fifth consecutive week of increments for the index. The uptick is steering it close to its year-to-date peak value of 305 USD per tonne.
The prime mover behind this price inflation was the stringent supply of Cr ore available at the Chinese ports, compelling smelters to turn their attention to the seaborne market. Furthermore, the sustained high production rates of Ferrochrome (FeCr) stimulated a surge in the prices for Cr ore lumpy amidst an augmented supply dearth in the seaborne market.
Turning our gaze to international shores, Turkish chrome ore echoed the upward price trend in the South African market. A hike in production led to a rise in the prices for Turkish-origin Cr ore in China. This surge paralleled the trends observed in UG2 prices from South Africa (SA). This scenario contributed to the diminution of port stock levels in China, a repercussion of the escalated FeCr production.
Despite the fluctuating dynamics, the foundational metrics for the Cr ore market retained their strength. The demand remained high, maintaining a firm ground for the recent robust market fundamentals.
As we approach a potential year-to-date high, stakeholders in the ferro-alloys industry are keenly monitoring the market trends. The existing conditions favor a sellers’ market, with the buyers enduring high prices due to the shortage in supply.
It is pivotal for industry players to keep a close eye on the developments in the Chinese and Turkish markets, as they continue to be significant influencers in the global chrome ore landscape. The current market dynamics underscore the necessity for strategic planning and foresight in procurement and production schedules to navigate the tightening supply landscape effectively. Keeping abreast with the ongoing trends will not only facilitate informed decision-making but also foster stability in a market characterized by its strong fundamentals.
All things considered, the chrome ore segment of the ferro-alloys market is traversing a period of sustained growth. With the UG2/MG index nearing its annual zenith, and the Turkish Cr ore prices on an upward trajectory, the industry is amidst a phase of high activity. As the demand continues to rise, a close watch on the market trends will be quintessential for industry stakeholders to strategize accordingly and maintain a steady course in the dynamic market landscape.
