The TEX Report Ltd.

The TEX Report Topics < Ferro Alloys >

HOME >> Topics List >> January, 2006 >> 17 (Tue)

Market Tendency On Imports Of Ferro-Alloys At 16th January 2006

Price Of Ferro-Moly Rebounded And Recovered To A Level Of US$50 / Kg.

The market tendency by item on imports of ferro-alloys into Japan at the 16th January of 2006 is as follows ;

<> General view = A basic tone to strengthen the exchange rate of Japanese Yen against US-Dollar has continued from late December of 2005 and entered into a level of US$1.00 : Yen 114. Therefore, Yen prices of bulk ferro-alloys to be settled with electric furnace mills in Japan for shipments in January - March quarter of 2006 had initially aimed at a substantial rise of Yen 10,000 per ton ( for silico-manganese ) based on the exchange rate of US$1.00 : Yen 120 but retreated from this target and it seems that many contracts were settled on the end December of 2005 by a rise of Yen 5,000 - 6,000 per ton on the basis of US$1.00 : Yen 115 - 116. In view of a basic tone of the exchange rate at present, even a rise of Yen 5,000 per ton was difficult to achieve. Usually, owing to a decrease of the production in winter season caused by a drought, prices of Chinese ferro-alloys rise basically but a shortage of electric power has been not seen at the beginning of new year and a potential power to supply ferro-alloys with enough quantities has induced to weaken or to remain unchanged prices of ferro-silicon and silico-manganese.

<> Ferro-silicon = A shortage of electric power is not heard in new year in comparison with a tight supply of electric power as seen in usual years and, prior to Lunar New Year to start from the end January, a positive attitude for sales of ferro-silicon taken by Chinese suppliers has come up to the surface. Chinese ferro-silicon is now being offered at US$630 - 640 per ton CIF Japan as a fall of US$10 per ton from that prevailed in December of 2005. A lower price of US$600 per ton FOB China is also sporadically seen. However, Chinese ferro-silicon has held an overwhelming power to compete on exports and, as a matter of fact, it is estimated that China exported 900,000 tons of ferro-silicon in the calender year ( January - December ) of 2005, having increased by 6.5% compared to that in the preceding year of 2004. An excessive supply of electric power in China has become remarkable in Ningxia Hui Aut. Region and Qinghai Province and a fall of electric power fee ( special rate of CNY0.22 per 1 KWH ) has been progressing. A considerable change of the consciousness concerning the production cost of ferro-silicon in China has arisen.

<> Silico-manganese = The quantity of silico-manganese exported from China in 2005 had a large decline of 45% from that in 2004. The overpurchases of silico-manganese by developed countries in 2004 had caused to adjust their purchases of this ferro-alloy in 2005 and the overproduction of silico-manganese by China in 2004 also turned to a reverse effect in 2005. On the other hand, the output of crude steel by blast furnace mills in Japan was on a favorable tone in 2005 but is anticipated to go down in 2006 and, accordingly, a surge of the demand for steel products in 2006 seems to be a lack of the vitality. Chinese silico-manganese is being offered at US$640 - 650 per ton CIF Japan, having remained unchanged, and it is marked to see how does price of Chinese silico-manganese move after Lunar New Year is over.

<> Charge chrome = The price of South African regular charge chrome for shipments in January - March quarter of 2006 has been settled by a reduction of 5 US-Cents per lb. but it is still opaque to ascertain whether price of charge chrome was able to finish a removal of all adverse factors or not. The exchange rate of South African Rand against US-Dollar has strengthened, causing an unprofitable production of charge chrome at South African companies, and there is a view in the market, therefore, that price of South African charge chrome will remain unchanged for shipments in April - June quarter and afterwards. However, as regards spot cargoes of high carbon ferro-chrome in question, Indian and Chinese products are still being offered at discounted prices and a differential of prices between regular material and spot material is more than 10 US-Cents per lb., indwelling an anxiety for price of charge chrome.

<> Molybdenum = Price of Chinese ferro-molybdenum has bottomed out and turned to rise. The price of Chinese product was once sporadically offered at US$48 - 49 per kg. CIF Japan, having broken a level of US$50 per kg., but these lowered prices have disappeared from the market. This rebound of price for Chinese ferro-molybdenum is said to be due to the substantial purchases of ferro-molybdenum by Chinese customers in advance of Lunar New Year to start from the end of January and dealers are now offering Chinese ferro-molybdenum at US$51 - 52 per kg. CIF Japan. The price of Chinese ferro-molybdenum once soared to a level of US$79 - 80 per kg. in early September of 2005 and, then, fell straightly but it is still not known yet whether price of Chinese product will bottom out by the current level as mentioned above or not. From a long standing point of view, a trend to loosen a tightness of the supply is inevitable and it is still opaque to see that this rebound of price for Chinese ferro-molybdenum is which one of the bottom prices. There is a big possibility that, when the purchases of molybdenum products from domestic market of China suddenly come up, the case to rebound these prices as seen this time will repeat like an intermittent fountain. The current price of molybdenum oxide is US$29.50 per lb. CIF Japan, having risen in accordance with a rise of price for ferro-molybdenum.

<> Ferro-vanadium = China had suddenly transformed again in 2005 to the country to export ferro-vanadium. China exported approximately 3,500 tons in material of ferro-vanadium in 2005 as increased by 52% compared with that in 2004. In consequence, price of ferro-vanadium has fallen and dealers are now offering ferro-vanadsium at US$37 - 38 per kg. CIF Japan, showing a further and gradual fall.

<> Manganese metal = The overproduction of electrolytic manganese metal in Changqing City and Guizhou Province of China has caused to offer this metal at the nearest level to US$1,200 per ton CIF Japan and a tendency to weaken the price is unable to stop. Owing to a taper of the matter to produce 200 series stainless steel, the demand for electrolytic manganese metal from domestic market of China has a lack of energy and, on the other hand, in view of the severe investigation of the environmental pollution implemented in China in autumn of last year, Japan and South Korea purchased more electrolytic manganese metal than their usual requirements in order to avoid a shortage of the supply. Consequently, these two countries have now held back to purchase this metal from China for adjustment of their stocks.

<> Silicon metal = Chinese silicon metal with 5.5.3 grade is currently being offered at US$1,000 - 1,020 per ton CIF Japan with a certain rise. The contracts with aluminum alloy plants in Japan on silicon metal to be shipped in January - March quarter of 2006 have been just concluded in December of 2005 and, accordingly, it is an off-season at present. Therefore, there is no reason to materialize new contracts at the price as offered from China. Many contracts concluded with aluminum alloy plants on silicon metal for shipments in January - March quarter are supposed to have been settled by the prices in the range of US$950 - 960 per ton CIF Japan. In comparison with these prices settled for January - March quarter, the current prices of silicon metal offered from China are in the direction to rise.

last modified : Fri 20 Jan, 2006 [11:26]