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Market Tendency On Imports Of Ferro-Alloys At 31st March 2010
= At International Conference Held In Hong Kong, Tightened Supplies And Risen Prices Surged Its Atmosphere
The market tendency by item on imports of ferro-alloys into Japan at the 31st March of 2010 is as follows ;

<> General view = In addition to a following wind, which the production activities at steel mills in Europe and the USA are reviving, the actual quantities of steels produced in China had increased in January and February. The circumstances to push up prices of ferro-alloys are being well prepared. At the International Ferro-Alloy Conference held in last week at Hong Kong, reflecting a favorable turn of the situation, participants had been supposedly high-spirited. Naturally, this aspect has become a factor to rise prices of manganese ferro-alloys and silicon ferro-alloys and the prices offered from China, India, and so on have risen further. On the other hand, immediately after the trading companies concerned in Japan have concluded the contracts with electric furnace mills on Yen prices of bulk ferro-alloys for shipments in April - June quarter, the exchange rate of Japanese Yen against US-Dollar has turned to weaken (US$1.00 : from Yen 90 to Yen 93) and, therefore, these trading companies have been steeply pressed to maintain a profitability for fulfillments of these contracts, including that for June shipment with a big probability to reckon a loss.

<> Ferro-silicon = While Russia is the country to export ferro-silcon following China, a favorable turn of the circumstances in Europe and the USA has caused to enable Russian producers to take a bullish attitude toward sales of ferro-silicon and Russians are now offering ferro-silicon for Japan at US$1,500 per metric ton CIF by a rise of US$100 per ton from that in the last time. Being stimulated by a sharp rise of price for ferro-silicon contracted with customers in Europe and the USA, some of Chinese producers are offering ferro-silkicon at US$1,380 - 1,400 per metric ton FOB but most of the prices for ferro-silicon offered from China are in the range of US$1,380 - 1,400 per metric ton CIF Japan, having risen by US$50 - 80 per ton compared with those offered in the middle of March. Nevertheless, many of the consumers concerned are still hesitating to pay these high prices for ferro-silicon but moving to admit the contracts at US$1,380 CIF by taking into consideration of a firm tone of price for ferro-silicon in July - September quarter. For a scarcity of rainfall in west-south district of China, a circle of the shortage of electric power is enlarging and ferro-alloy producers in Yunnan Province, Sichuan Province and Guizhou Province, where have relied upon supply of electricity generated at hydroelectric power stations, have been driven to reduce their operations. This problem is now becoming a serious subject to be resolved.

<> Silico-manganese = The prices on CIF Japan base of silico-manganese produced in China and India are becoming a similar level. The price of Indian silico-manganese was so far more than US$100 per ton lower than that of Chinese product but, since Indian producers have taken a bullish attitude toward sales of silico-manganese, both prices are now approaching the same one. The current prices of silico-manganese offered from these two countries are US$1,500 per metric ton CIF Japan for Indian product and US$1,500 - 1,550 per metric ton FOB for Chinese product. Therefore, a differential of prices between these two products has shrunk to a large extent. The reason, why Indian producers have taken a strong position for their sales, is a recovery of the exports for Europe. The highest price of Indian silico-manganese actually contracted with Japanese consumers has risen up to US$1,480 per metric ton CIF. Some of the trading companies concerned in Japan were once more interested in a low price of Indian silico-manganese and had held back to purchase Chinese product at a high price but have currently anticipated to see a time to commit their contracts on Chinese silico-manganese even at some high prices in the course of April.

<> Charge chrome = The negotiations with steel companies in Europe on price of South African charge chrome for shipments in April - June quarter are currently being taken place but have unexpectedly needed a time to settle this matter. The producers' side is supposed to have requested to rise the benchmark price for April - June quarter to a level of about 140 US-Cents per lb. of Cr by adding 40 US-Cents to the benchmark price for January - March quarter (101 US-Cents per lb. of Cr for Europe) but, on the other hand, stainless steel companies in Europe have insisted on the maximum price of 120 US-Cents and, accordingly, a differential of prices between the two parties is still substantial. China is scheduled to produce 10 million tons per annum of crude stainless steel in 2010, which will exceed the total quantity to be produced in EU countries, and spot prices of high carbon ferro-chrome (charge chrome) contracted with Chinese customers are in the range of 115 - 118 per lb. of Cr CIF, which are lower than the benchmark price for April - June as proposed by South African producers to European mills. Therefore, a differential of prices between spot cargoes and regular cargoes to be settled at new benchmark as requested by major producers has enlarged. The lowered price of high carbon ferro-chrome (charge chrome) exported for China has become a critical matter for consumers in Japan and Europe since a previous time and, in relation to a rise of price for South African charge chrome to be shipped in April - June quarter, this subject is becoming more important.

<> Low carbon ferro-chrome = The prices of low carbon ferro-chrome contracted with regular consumers (special steel companies) in Japan for shipments in April - June quarter of 2010 are in the range of 190 - 195 US-Cents per lb. of Cr CIF for carbon 0.1% max. material, having risen by 20 US-Cents compared to those for the preceding quarter of January - March. The prices for European mills are in the range of 195 - 200 US-Cents per lb. of Cr on DDP base for carbon 0.1% max. material and producers' side has achieved an aim to rise the price. However, it was not possible for producers to rise the price of carbon 0.1% max material to a level of 200 US-Cents per lb. of Cr as initially targeted.

<> Silicon metal = Owing to a scarcity of rainfall continued from autumn of last year in Yunnan Province, Sichuan Province and Guizhou province of China, a drought has arisen together with a period of water shortage in winter season and this serious climate has caused a considerable reductio in production of silicon metal, which has been based on electric power generated at hydroelectric power stations. Consequently, a tightness on supply of actual cargoes has been accelerated. However, because of a delay in revival of the production at aluminum alloy plants in Japan, the inquiries for silicon metal from Japan are in a lack of the vitality. Therefore, the prices of silicon metal offered from China are in the range of US$2,320 - 2,350 per metric ton CIF Japan, having risen only by US$100 per ton compared to that in the middle of March. Usually, China enters into a rainy season from March - April and producers move to increase their production of silicon metal but a contrary phenomenon is arising in this year.

<> Manganese metal = The bases to produce electrolytic manganese metal in China have been located in west-south district of China (such as Sichuan Province) in the same case as that of silicon metal and are suffering from a shortage of water. This aftereffect (causing a short supply of electric power) is anticipated to continue further. Accordingly, the current prices of electrolytic manganese metal in domestic market of China are in the range of CNY15,300 - 15,500 per metric ton ex. plant. Under the circumstances, many of the parties concerned have emphasized on the sharply risen prices of nickel metal and iron ore. Therefore, the prices of electrolytic manganese metal offered from China for export are in the range of US$2,920 - 2,950 per metric ton FOB and the actual price of Chinese product contracted with Japanese customers has risen to a level of approximately US$2,900 per metric ton CIF, although some of Japanese consumers have opposed to a sudden and sharp rise of price for Chinese electrolytic manganese metal from the beginning of March.

<> Molybdenum = The matter to rise continuously price of molybdenum oxide has made a pause and the current price of molybdenum oxide has remained on the same level as that in the middle of March. Namely, the prices at present are US$16.90 - 17.30 per lb. of Mo for molybdenum oxide and US$40 - 41 per kg. of Mo for ferro-molybdenum, both of which have remained unchanged. In comparison with those prevailed on the end of last year, the current prices have risen by 45 - 50% for the last 3 months and are on the phase to sell molybdenum at a profit.

<> Ferro-vanadium = In view of the fact that actual cargoes of ferro-vanadium have tightened, having caused to change the supply situation, market price of ferro-vanadium is on a basic tone to rise gradually. According to a survey by a major producer, a reduction in production of ferro-vanadium is becoming effective and the difficulties to secure vanadium pentoxide as raw material for production of ferro-vanadium are anticipated to stimulate price of ferro-vanadium in the near future. The current prices of ferro-vanadium are in the range of US$32 - 34 per kg. of V, having risen by US$1.00 per kg. of V compared with that in the middle of March and also risen by 30% compared to that at the beginning of this year. The world demand for ferro-vanadium has recovered by 15% in comparison with the level at the end of 2008, when the consumption of ferro-vanadium was placed on the lowest one. If the pattern in trades, which China decreases their exports and increases their imports as become remarkable from 2009, would have been followed even in 2010, market price of ferro-vanadium is still expected to rise further.
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last modified : Tue 06 Apr, 2010 [09:50]
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