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| Market Tendency On Imports Of Ferro-Alloys At 31st July 2009 |
| = Chinese Electrolytic Manganese Metal Is Groping For A Further Rise Of Its Price |
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The market tendency by item on imports of ferro-alloys into Japan at the 31st July of 2009 is as follows ; <> General view = A fall of Yen prices for bulk ferro-alloys (ferro-silicon and silico-manganese) imported into Japan and contracted with electric furnace mills for shipments in July - September quarter has at last ended. The reason is that a leading electric furnace mill in Kanto area held in last week a tender to purchase bulk ferro-alloys for shipments in a single month of August and the Yen prices contracted with this mill have risen by Yen 4,000 per metric ton for ferro-silicon and by Yen 20,000 per metric ton for silico-manganese respectively. Yen prices of bulk ferro-alloys once reached a peak in July - September quarter of 2008 and, after that, continued to fall for a long period of about 12 months. The highest Yen prices (per metric ton delivered to mills) were Yen 275,000 per ton for silico-manganese and Yen 263,000 per ton for ferro-silicon. At the tender for only August shipment as mentioned above, the Yen prices settled with this mills are Yen 120,000 per metric ton delivered to mill for silico-manganese and Yen 118,000 for ferro-silicon respectively. These movements of Yen prices are an evidence of how large extent did Yen prices of bulk ferro-alloys fall. <> Ferro-silicon = Price of Chinese ferro-silicon is in a fever of the active demand from domestic market and a local price of ferro-silicon in China has risen to a certain level, corresponding to US$1,170 - 1,180 per metric ton FOB China. Accordingly, Chinese shippers are now offering ferro-silicon at US$1,150 per metric ton CIF Japan as one of the lower prices. Russian suppliers have also taken the offensive to sell ferro-silicon on a level of US$1,150 CIF Japan and, therefore, the market tone of ferro-silicon is going to change. On the other hand, it was informed that the Central Government of China is scheduled to raise electricity fee in July - September quarter of this year, and Chinese producers are going to take a cautious attitude for sales in forward shipments. The Central Government of China already raised electricity fee in July of 2008 after an interval of two years and, therefore, opaque parts of this raise have still left but a raise of electricity fee is a vital question for producers. <> Silico-manganese = Under the circumstances which domestic price of silico-manganese in China has been rising in every week, many factors to move export price of this ferro-alloy are seen. Domestic price of Chinese silico-manganese has risen from CNY7,400 - 7,500 per ton at a previous time to CNY8,000 per ton at present and an information is the higher price of CNY8,200. Domestic price of CNY8,000 per ton corresponds to US$1,400 per metric ton (including export duty of 20%) FOB China. However, some shippers have already offered silico-manganese at US$1,450 per metric ton CIF Japan and an atmosphere to take a bullish attitude for sales has been sporadically seen. According to an information, South Korean companies will concentrate their production on silico-manganese by the end of this year and, therefore, it is questioned whether South Korean producers offer in August silico-manganese for September shipment or not. Since the exchange rate of Indian Rupee against US-Dollar has strengthened, Indian producers offered silico-manganese up to September shipment and, then, have taken an attitude to watch carefully about further movements of price for silico-manganese to be shipped in the future. For a reference, it seems to be inevitable to rise price of manganese ore as raw material to be shipped to regular consumers in October and afterwards but it is too early to forecast an extent of price to be risen. The movements to anticipate price of manganese ore for forward shipments are in confusion. <> Charge chrome = When a depression of the chrome market in Europe has been reviewed, it is understandable that the stocks of ferro-chrome at both sides of suppliers and consumers have shrunken and this aspect has come up to the surface. Accordingly, stainless steel mills have moved to purchase ferro-chrome on spot base. At present, main action is to purchase high carbon ferro-chrome (with Cr 60 - 65%) and spot prices are in the wide range of 98 - 105 US-Cents per lb. of Cr, including part to be a higher level than benchmark price. For a reference, spot price of low carbon ferro-chrome (with C 0.1% max.) has been normalized on a level of 180 - 190 US-Cents per lb. of Cr and it is now highly interested in seeing the price to be settled with regular consumers for shipments in October - December quarter. On the other hand, a considerable reduction (by more than 50%) in production of charge chrome had been maintained in South Africa for a long period but the output of South African charge chrome in the second half of 2009 is expected to recover to a scale of 70% of nominal capacity and South African producers are regaining their vitality. In view of many factors to raise production cost which are a raise of electricity fee, an increase of wages and a rise of coke price, the benchmark price of South African charge chrome has risen by 20 US-Cents per lb. of Cr for shipments in July - September quarter but even this rise is still unable to cover an increase of production cost. Therefore, there is an opinion in the market that it will be inevitable to rise again benchmark price of charge chrome for shipments in October - December quarter. <> Manganese metal = Chinese shippers have suddenly turned to take a bullish attitude for sales of electrolytic manganese metal and domestic price of this metal is on a basic tone to rise. Reflecting a sharp rise of nickel price and a favorable tone of demand for stainless steel in China, domestic price of electrolytic manganese metal in China is supposed to have risen by CNY400 per ton to CNY14,000 per metric ton and a higher price of CNY14,500 was also offered. Therefore, the price of Chinese electrolytic manganese metal offered for export was US$2,580 per metric ton FOB but has already risen to US$2,700 per metric ton CIF Japan. Local manganese mines (to produce manganese carbonate as raw material) in China have been driven to suspend their production because of the sales of manganese ore imported into China and offered at discounted prices and, consequently, the sources to supply manganese ore have been restricted. At all events, a recovery of steel production in China has enabled Chinese producers to take a bullish attitude for sales of electrolytic manganese metal and, in order to ensure stable supply of this metal, major steel companies in China have proposed to conclude long term contracts with suppliers. This seems that, in anticipation of a rise of price for manganese ore in the near future, steel mills have taken the initiative. <> Silicon metal = The price of Chinese silicon metal with 5.5.3 grade for export had continued to remain unchanged for a long period but has now moved to rise. This metal is being currently offered at US$1,630 - 1,650 per metric ton CIF Japan by a rise of US$30 - 50 per ton. <> Molybdenum = Spot price of molybdenum oxide has still continued to rise. Traders have forecasted price of molybdenum oxide at the end of this year as US$18 - 20 per lb. of Mo and this forecast is fairly positive in comparison with the current market prices (US$14.50 - 15.75 per lb. of Mo). In view of the tightened supply of molybdenum, traders have attached an importance to purchases of actual cargoes than sales. Molybdenum producers in North America had once proceeded to reduce molybdenum production and, therefore, it will take a certain time to loosen the structure for its reduction. Stainless steel companies in Europe had suffered from a depression of the market for a long period but it is now viewed that the production of stainless steel in Europe will revive after summer holidays are over. This aspect is thought to be effective to sustain molybdenum prices. <> Ferro-vanadium = Market price of ferro-vanadium is still keeping to rise and dealers are now offering ferro-vansdium at US$27.50 - 28.50 per kg. of V CIF Japan, having risen by US$3 per kg. of V from that at the end of June. |
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| last modified : Thu 06 Aug, 2009 [10:28] |
