Ferro Chrome, Charge Chrome Prices To Rise

South Africa reportedly has offered to supply to Europe Ferro chrome/Charge chromeat 49 cents per lb of chromium for the period April/June 1997.This is a rise of 7 cents over the price of 42 cents per lb of chromium during January/March 1997.

It is felt that the contracts will be concluded at 48 cents per lb as spot prices have already crossed 50 cents per lb. There is cautious optimism that the increase will last for some time and prices will move up further during 1997, but not to the height of mid-1995 when the price touched 85 cents.

The boom resulted in a burst with prices falling by 50 per cent.

 

This time there is more restraint among the producers.

The production and sales of FeCr in Kazakhstan is now controlled by the Japanese and western trading countries. Donskoy Chrome Mine which can produce 3.5 million tonnes of chrome ore will produce only about 1.5 million tonnes .There are also large quantities of stainless steel scrap available in ex-USSR. Therefore, a rapid rise in the price of ferro chrome is unlikely.At the same time, Chrome ore price is rising in the world market and China reportedly cannot produce and market ferro chrome at less than 50 cents a lb of chromium.

Indian FeCr Production:India produces an average of 250,000 tonnes of high carbon FeCr and exports about 150,000 tonnes.

Facor exports about 50,000 tonnes and Tatas from their own production and conversion agreements export about 80,000 to 100,000 tonnes.

If the market improves there are other producers of FeCr like G M R Vasavi, Srinivasa Ferro, Ispat Alloys, ICCL who can export.

It is now learnt that NTPC power is being supplied to ferro alloy producers in Andhra Pradesh.

All these producers are producing ferro chrome for exports and with the rising ferro chrome market they should benefit.

The main beneficiaries will be Facor, G M R Vasavi, Nav Bharat and VBC. NTPC power for export production is now becoming a reality and if it is made available to all producers there should be a dramatic rise in the export of ferro alloys from India in 1997-98

Chrome ore imports by China: China imported 764,000 tonnes of chrome ore in 1996 against 1,381,000 tonnes in 1995.

Less import was because of the steep fall in world ferro chrome prices.

India was the largest supplier of chrome ore to China with 286,877 tonnes against 446,511 tonnes in 1995.

South Africa was the second largest supplier at 139,292 tonnes in 1996 against 235,997 tonnes in 1995. Turkey came third with 97,719 tonnes against 276,299 tonnes.

Average unit price of chrome ore in 1996 for China was $164 per tonne. CIF unit price for India during January/March 1996 was $220 per tonne while the same fell to $150 during October/December 1996.

MMTC is the canalising agency for Chrome ore exports.

It fixed the floor price for chrome ore for export during January/March 1997 for friable ore on FOB basis as:Cr203 46-44 basis 46% $ 105, Cr203 50-48% basis 50% $ 120, Cr203 52 - 50% basis 52% $ 125, Chrome concentrate $ 133 per tonne CIF

Chrome ore prices are likely to go up further as the prices of Ferro chrome high carbon and charge chrome are going up.

Tatas on chrome ore: The Tatas continue to dominate the chrome ore scene in India despite their lease being cut from 1260 ha to 480 ha.

In 1996 they have produced around 750,000 tonnes of friable chrome ore and 150,000 tonnes of concentrates.

Exports of chrome ore from India will be around 300,000 tonnes of friable ore and 170,000 tonnes of concentrates.

Another 40,000 tonnes of lumpy ore is also likely to be exported.

The Tatas are the biggest exporter of chrome ore in India. They also produce around 100,000 tonnes of ferro chrome mostly for export..

Manganese ore price for 1997-98: International price for high grade manganse ore for 1997-98 has been settled by reducing it by 5 per cent over the 1996-97 price.

The 1996-97 price for BHP of Australia was $2.19 per Mn 1% FOB while for Samancor of South Africa it was $2.09 per Mn 1% FOB.

These suppliers offer manganese ore with 48 per cent manganese and low phos of 0.05 per cent.

China imported 1,596,000 tonnes of manganse ore in 1996 against 1,290,000 tonnes in 1995, thus becoming the world biggest importer.

The manganese ore unit price for China was $2.39 CIF from South Africa, Gabon, $2.36 and Brazil, $2.13. China produces over 3 million tonnes of manganese ore mostly of 25 per cent Mn and needs to import high grade manganese ore

India became the largest exporter of manganese ore to Japan during January/June 1996 . Against the total imports of 637,000 tonnes by Japan, India supplied as much as 221,000 tonnes. South Africa came second with 175,000 tonnes and Australia third with

155,000 tonnes. Brazil was the fourth with 42,000 tonnes and and Gabon fifth with 26,000 tonnes.