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|Market Tendency On Imports Of Ferro-Alloys At 28th November 2008|
|= Price Of Chinese Manganese Metal Bottomed Out And Rebounded|
The market tendency by item on imports of ferro-alloys into Japan at the 28th November of 2008 is as follows ;|
<> General view = A strong wind to reduce the production of ferro-chrome in South Africa is now howling frightfully. Most of South African producers have been driven to decrease their production of ferro-chrome to less than 50% of its nominal capacity and this basic tone is in the direction to continue in the first half of 2009 at least. The case to defer shipments of ferro-chrome as requested by such stainless steel mills as ArcelorMittal has come up to the surface in the middle of November and this matter is suggesting how extent is drastic for the request from mills. South African producers have been currently experiencing a dramatic recession as the first case in its history and facing a storm to adjust the world economy, being unable to escape from it. Having differed from the attitude for ferro-chrome taken by stainless steel mills in Europe and China, almost of stainless steel companies in Japan, excluding part of specialized stainless steel mills, have in principle esteemed the existing contracts. This aspect has contrasted with the attitude in Europe but a period to adjust stocks of ferro-chrome in Japan is thought to be postponed accordingly. For a reference, Chinese producers have finished temporarily to improve their supply position and. consequently, price of Chinese electrolytic manganese metal has turned to rise by US$200 per ton from the bottom.
<> Ferro-silicon = Price of Chinese ferro-silicon offered for export has entered into a level of US$1,100 - 1,200 per metric ton FOB China and its profitability has at last come to be a loss. Reflecting this market situation, Chinese producers in Inner Mongolia Aut. Region and Ningxia Hui Aut. Region, where are main bases to produce ferro-silicon, have entered into the structure to reduce drastically their production of ferro-silicon. In order to cope with a depression of the steel market, Chinese steel mills have already cancelled the outstanding contracts on ferro-silicon and have been relieved of their burden. It seems to be necessary to take time that, after having passed Lunar New Year in China to start from the 24th January of 2009, the economic activities in China revives, and an adjustment on supply and demand of ferro-silicon in China is anticipated to finish in February of 2009 and afterwards.
<> Silico-manganese = Price of Chinese silico-manganese has been still not felt by the market to have bottomed out. The current price offered from China for import into Japan is in the range of US$1,300 - 1,400 per metric ton CIF Japan, having shown a gradual and further fall. In the course of time, it is marked to watch about the movements to be taken by trading companies on negotiations with electric furnace mills to settle Yen price of silico-manganese for shipments in January - March quarter of 2009, which are scheduled to be held from the beginning of December. When the current price of Chinese silico-manganese offered on US$ base for import into Japan is combined straight with the strengthened Japanese Yen, a considerable fall of Yen price for silico-manganese is required but major distributors are going to decide the direction to reduce Yen price step by step on quarterly base. Electric furnace mills in Kanto area have generally agreed to this concept. The market price of silico-manganese had once run wild throughout 2008 but it is marked to see whether a terminal of price for silico-manganese will come to an amicable settlement as a result of the negotiations to be taken place in the next 2 weeks or not.
<> Charge chrome = South African producers have been driven to reduce their production of charge chrome to an extraordinary extent in its history and have strengthened a feeling, which a recovery of the market for charge chrome is hard to expect in the first half of 2009. This has told that a pressure to delay shipments under the outstanding contracts placed by stainless steel mills in Europe and China is so much heavy. Spot price of charge chrome in Europe is 110 - 120 US-Cents per lb. of Cr at present and, therefore, there is an opinion in the market that the price (benchmark price) of charge chrome to be contracted for shipments in January - March quarter of 2009 will be inevitable to reduce to a level of 120 - 130 US-Cents per lb. of Cr.
<> Low carbon ferro-chrome = December is the time to renew contracts with regular consumers for shipments in January - March quarter of 2009 and, prior to the negotiations, it is interested in seeing at which prices these contracts are renewed. First of all, the circumstances are thought to be inevitable to reduce prices of low carbon ferro-chrome, following that for shipments in October - December quarter of 2008. In view of the facts that no buyer is located in Europe and spot prices of low carbon ferro-chrome are still on a basic tone to fall further, a key is the movements of prices in Europe and the USA. The matter in question is whether the price of 300 US-Cents per lb. of Cr for regular low carbon ferro-chrome with carbon 0.1% max. is possible to keep or not. Under this depressed market, Chinese low carbon ferro-chrome stocked at warehouses in Rotterdam has felt a repugnance to the lowered price in Europe and aimed to sell the stocks in the USA by a rise of 50 US-Cents per lb. of Cr. The price of Chinese low carbon ferro-chrome with carbon 0.1% max. stocked and offered in Europe is 240 US-Cents per lb. of Cr at present. For a reference, the current price of regular low carbon ferro-chrome sold in the US market has still kept a level of 360 US-Cents per lb of Cr for carbon 0.1% max material and, accordingly, a chance to sell this low carbon ferro-chrome in the USA is supposed to have still existed.
<> Manganese metal = The domestic price of electrolytic manganese metal in China has bottomed out and rebounded. The current price of this metal sold in domestic market has risen to a level of CNY12,000 - 12,500 per ton, which is a rise of CNY1,000 per ton compared with that in the middle of November, and this is a result of the adjustment on supply and demand of electrolytic manganese metal. This aspect is due to an effect that medium and small plants in China, excluding major producers, have suspended their production. Consequently, the price of Chinese electrolytic manganese metal offered for export has come to US$2,300 per metric ton CIF Japan, having risen by US$200 - 300 per ton compared to that in the beginning of November and also by US$100 per ton from that in last week. Price of Chinese electrolytic manganese metal fluctuates to a large extent and, on the occasion of this price rebound, a possibility to rise further price of this metal is anticipated to see, if the demand for Chinese electrolytic manganese metal from overseas countries comes up. The cost to produce electrolytic manganese metal at major companies of China is estimated to be US$2,100 per metric ton FOB and some of Chinese enterprise will be possible to maintain a profitability but the cost for enterprises to purchase manganese ore and to produce this metal from this ore by electrolytic method is thought to be not payable. Price of Chinese electrolytic manganese metal has bottomed out but the base to demand this metal in domestic market is not recovered entirely and, accordingly, an anxiety for the price rebound has been still seen.
<> Molybdenum = The market price of molybdenum oxide once fell to US$8.25 per lb. of Mo but turned to rise somewhat in the second half of last week. The dealer oxide price is in the range of US$8.50 - 9.50 per lb. of Mo and this price rebound is due to coverage of short sales and spot purchases prior to Christmas, having arisen in Europe. ArcelorMittal once decreased their steel production by 15% but has now entered into the structure to reduce the production by 35% and it is still opaque to foresee whether price of molybdenum oxide is bottomed out by this price level or not. However, in view of the fact that price of molybdenum oxide has steeply fallen from a high level of US$30 to a lower level than US$10 for the last 2 months, it is no wonder to see a reasonable price of molybdenum oxide in due course of time. Ferro-molybdenum is now being offered at US$23.50 - 25.50 per kg. of Mo CIF Japan.
<> Ferro-vanadium = Dealers are offering ferro-vanadium at US$31 - 33 per kg. of V CIF Japan, having still fallen gradually and reached the lowest one in 2008. This price level is a little higher than US$30.
<> Silicon metal = The duty to be imposed on export of Chinese silicon metal has been raised by 5% to 15% from the 1st December of 2008. However, a raise of the cost for export of silicon metal is unable to reflect the price for export. On the contrary, the price of silicon metal (with 5.5.3 grade) to be exported from China has fallen to a level of US$1,700 - 1,750 per metric ton CIF Japan, which has had a considerable reduction from that in early November, and this sharp fall of price for export of Chinese silicon metal is due to the situation, which the demand for silicon metal in Japan has decreased to an unexpected large extent and a complete buyer's market has come up. In order to prepare for a raise of the export duty from December, the cargoes based on 10% duty were dumped in late November and the discounted price was on a level of US$1,600 per metric ton CIF Japan. In advance of the end of the year, the market situation of silicon metal in China has confused to a substantial extent. A consequence caused by the reduced production of automobile is now lapping the market of Chinese silicon metal.
|last modified : Thu 04 Dec, 2008 [10:01]|