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Market Tendency On Imports Of Ferro-Alloys At 16th June 2008
= Yen Prices Of Bulk Ferro-Alloys To Be Contracted With EF Mills / Japan Are Influenced By Weakened Yen Rate
The market tendency by item on imports of ferro-alloys into Japan at the 16th June of 2008 is as follows ;

<> General view = The Government of the USA has clearly taken an attitude to defend the currency of US-Dollar and, accordingly, the exchange rate of Japanese Yen against US-Dollar has suddenly weakened ( US$1.00 : Yen 108 ). Therefore, the negotiations with electric furnace mills of Japan on Yen prices of bulk ferro-alloys for shipments in July - September quarter have now faced the difficulties to settle soon. While the matter to fix in advance the exchange rate of Yen / US$ for future deliveries is not negligible, the distributors concerned had initially imaged the exchange rate as US$1.00 : Yen 103 - 104 but the realities are developing on an unexpected phase. Excluding Nagoya area where the negotiations with electric furnace mills on Yen prices of bulk ferro-alloys have already finished, electric furnace mills of Kanto and Kansai areas are scheduled to start the negotiations on Yen prices of bulk ferro-alloys for July - September quarter from this week and the prices to be proposed by distributors are on a basic tone to rise. However, it is supposed that Tokyo Tekko, which firstly held a tender for purchases, has booked silico-manganese at Yen 257,000 - 258,000 per metric ton delivered to mills for quarterly contract (July - September), having had a slightly lower level than Yen 260,000 per metric ton. Some of distributors have still held stocks of silico-manganese and, consequently, there is a possibility that Yen price of silico-manganese will come to be uneven.

<> Ferro-silicon = When price of Chinese ferro-silicon has reached a level of US$2,500 per metric ton CIF Japan, this US$ price has turned to become the phase to come to a standstill and, in order to secure a profit, some offers at a lower price than US$2,400 CIF are sporadically seen at present. A fall of price for Chinese ferro-silicon is thought to be coming out. Therefore, it is now interested in seeing how extent does US$ price of Chinese ferro-silicon fall hereafter. In view of the fact that price of Chinese ferro-silicon has risen from US$1,500 per metric ton CIF Japan prevailed in mid April up to US$2,500 CIF as of the end of May, having resulted in a considerable rise of US$1,000 per ton for a little more than one month, a fall of about US$500 per metric ton is possible to come up but some of the parties concerned have anticipated that the bottom price of Chinese ferro-silicon at present will be on a line of US$2,200 - 2,300 per metric ton CIF Japan. A fever, having soared price of ferro-silicon, is cooling down for the time being. However, some of the trading companies concerned are enthusiastic to negotiate with electric furnace mills on Yen price of ferro-silicon for shipments in July - September quarter with an aim to succeed in a considerable rise of Yen 100,000 per ton compared to those (Yen 150,000 - 160,000 per metric ton) contracted for April - June quarter.

<> Silico-manganese = A tide for price of silico-manganese prevailed in April to May was to rectify the so soared price of this ferro-alloy and Indian silico-manganese was offered at US$2,200 - 2,300 per metric ton CIF Japan. This tide has still survived even in June. An advantage of Indian product, which is nil of export tax, is being demonstrated to Chinese product, which has been enforced to pay 20% of export duty. However, since the price of manganese ore for shipments to China in July - September quarter has been settled by a rise of 35% from that for April - June quarter, an outlook for price of Chinese silico-manganese in the near future is a further rise for increasing cost of the production In anticipation of this aspect, many of Chinese shippers are offering silico-manganese at higher prices than US$2,500 per metric ton CIF Japan. However, owing to the currently strengthened exchange rate of Yen against US-Dollar (US$1.00 : Yen 108), the trading companies concerned are now suffering from how to include these two factors in Yen price of silico-manganese to be contracted with electric furnace mills and have been driven to choose a slight rise or its roll-over. For a reference, at the negotiation with an electric furnace mills held in the week before last, a lower price than Yen 260,000 per metric ton delivered to mills was offered and this price level is not a substantial rise in comparison with those (Yen 255,000 - 260,000) contracted for deliveries in April - June quarter. This movement will put a delicate influence on the negotiations on Yen price of silico-manganese for July - September quarter to be taken place in this week.

<> Charge chrome = The negotiations with stainless steel companies in Europe on price of South African charge chrome for shipments in July - September quarter are being taken place from last week. The situation is not known yet but Indian product has been offered at discounted prices, although the quantity to be supplied from India has been restricted, and it is wondered whether Indian product offered at discounted prices is able to break the projecting part of South African intention or not. In view of the fact that the price of South African charge chrome contracted with major stainless steel companies for April - June quarter has been settled by an extraordinary rise of 55%, it is anticipated that these mills are thought to object strongly against a further and substantial rise of price for South African charge chrome to be shipped in July - September quarter. Incidentally, the production of stainless steel in July - September quarter is anticipated to be depressed.

<> Low carbon ferro-chrome = The negotiations with regular consumers on price of low carbon ferro-chrome to be shipped in July - September quarter have been taken place from last week. Shippers' side has targeted to settle the price at US$5.15 per lb. of Cr CIF Japan on average for carbon 0.1% max. material. In comparison with those (US$4.65 - 4.80) fixed for April - June quarter, the prices to be concluded for July - September quarter will rise by 7 - 10%. The steeply risen prices of low carbon ferro-chrome on spot transactions have become the factor to support price of regular low carbon ferro-chrome.

<> Manganese metal = The producers of electrolytic manganese metal in China have been seriously damaged by the large earthquake occurred in Sichuan province of China but the market price of this metal does not show a substantial surge. Being stimulated by this earthquake, the market price of Chinese electrolytic manganese metal has risen by US$500 per ton to a level of US$4,450 - 4,500 per metric ton CIF Japan but, after that, remained on this price level. However, Sichuan province is a main base to produce electrolytic manganese metal with selenium free but South Africa, where is also able to produce this grade of electrolytic manganese metal, has been now placed under the circumstances, which are not possible to increase production of this metal for the reduced supply of electric power in South Africa. Therefore, the supply of electrolytic manganese metal to aluminum industry is anticipated to have a considerable shortage. The demand for electrolytic manganese metal from metallurgical sector has seen a lack of the surge. In view of a differential of prices between electrolytic manganese metal and refined ferro-manganese as a substitutive material for this metal, it is marked to see when do steel mills return to be interested again in purchases of electrolytic manganese metal, price of which is comparatively lower than that of refined ferro-manganese.

<> Silicon metal = The negotiations with aluminum alloy plants of Japan on price of silicon metal for shipments in July - September quarter have nearly finished by last week. Unexpectedly, the prices settled for July - September quarter are in the range of US$2,200 - 2,300 per metric ton CIF Japan, having remained as nearly unchanged from those fixed for April - June quarter. Therefore, silicon metal is only the material, which is free from an influence of price caused by the Sichuan earthquake. The Chinese producers concerned have adopted the policy to comply with the demand for silicon metal from Japanese consumers by prompt deliveries from cargoes stocked in Japan and, consequently, the price of Chinese silicon metal for July - September quarter has been settled by roll-over. Price of Chinese ferro-silicon had once risen to a higher level than US$2,500 per metric ton CIF Japan and, at that time, the market price of ferro-silicon was higher than that of silicon metal. Reflecting the steeply risen price of ferro-silicopn, price of Chinese silicon metal had once taken an attitude to rise to a large extent but the activities to sell and reduce the cargoes stocked in Japan have motivated to let price of silicon metal remain unchanged.

<> Ferro-vanadium = The market price of ferro-vanadium in Europe is in the range of US$82 - 85 per kg. of V without a remarkable change. Under the present situation, having passed one month since th earthquake occurred on the 12th of May, the traffic conditions are still unable to restore and the sharply risen price of ferro-vanadium has been underpinned by a delay of the restoration .

<> Molybdenum = The representatives of Codelco in Chile and Kennecott in the USA are scheduled to come successively to Japan in the second half of June. The quantities of molybdenum to be produced by both companies in 2008 are on a basic tone to decrease and, if this basic tone is continued in 2009, a tightness on supply of molybdenum is thought to be carried over to next year. The total quantity of molybdenum products exported from China in January - March quarter of 2008 was squeezed in the quota allocated for exports in the quarter and the exports of molybdenum products from China to overseas countries have been regulated. Dealers are currently offering ferro-molybdenum at US$78 - 79 per kg. of Mo CIF Japan, having fallen somewhat from that prevailed on the beginning of June.
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last modified : Fri 20 Jun, 2008 [10:32]
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