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Market Tendency On Imports Of Ferro-Alloys At 15th April 2010
= Moving To Place Inquiries For Ferro-Alloys Before Chinese Suppliers
The market tendency by item on imports of ferro-alloys into Japan at the 15th April of 2010 is as follows ;

<> General view = The trading companies concerned are at last moving to import ferro-alloys produced in China. Because of having felt a repugnance to the higher prices, these trading companies had held back to purchase ferro-alloys for more than one year but are currently moving on imports of ferro-alloys. The background of this movement can be pointed out by the fact that major steel companies in Japan are now launching to purchase raw materials for shipments in July - September quarter. Additional orders for small lots of ferro-alloys under the existing contracts for April - June quarter are also being placed before suppliers. Also, while European countries and the USA were traditional markets for Indian silico-manganese and Russian ferro-silicon respectively in the past years, these markets have now shifted to a basic tone to revive the demand for imports of ferro-alloys. Therefore, the fact, which these suppliers have independently risen their prices of ferro-alloys for sales to Japan, has come up to the market at the same time.. The imports of Chinese ferro-alloys into Japan had been depressed for more than one year but have currently turned to take off. In addition, the Chinese exporters concerned are facing a risk for the revaluation of Chinese Yuan.

<> Ferro-silicon = Being backed up by a recovery of the demand for ferro-alloys in Europe and the USA, price of Russian ferro-silicon is now being offered at US$1,550 per metric ton CIF Japan by a further rise of US$50 per ton. However, this price of Russian product is US$100 - 150 per ton higher than spot price of Chinese ferro-silicon and, therefore, is not workable on export to Japan. Although price of ferro-silicon in domestic market of China has risen to CNY6,250 per ton, Chinese ferro-silicon is still being normally offered at US$1,380 - 1,400 per ton FOB China or at US$1,400 per ton CIF Japan, both of which have had a slight rise from that at the beginning of April. The distressed cargoes of ferro-silicon stocked in Japan for a long period are now being disposed and, accordingly, the thinned stocks of ferro-silicon in Japan have been reported to the market. This aspect on stocks of ferro-silicon is supposed to be a reason to restrict an extent of the rise.

<> Silico-manganese = In addition to the fact that price of manganese ore as raw material for production of silico-manganese has risen by 4.6% for May shipment to China and this rise of ore price will certainly cause to raise its production cost, Indian side has taken a bullish attitude for sales of silico-manganese. Indian silico-manganese is now being offered at US$1,590 - 1,650 per metric ton CIF Japan and part of these prices is finally equivalent to that of Chinese product. Therefore, an intention to purchase Chinese silico-manganese has surged and the positive negotiations with Chinese suppliers on imports of silico-manganese into Japan are being taken place after an interval of one year. Accordingly, market price of silico-manganese is still on the way to rise further. Chinese silico-manganese is currently being offered at US$1,600 - 1,650 per ton FOB China, partially at a higher price of US$1,700 (by Jilin Ferro-Alloy). The capacity to produce silico-manganese in China has had an enough potentiality to increase it in comparison with that of India and this flexibility in China has been evaluated by the parties concerned. Since steel companies in Japan are now moving to purchase silico-manganese for shipments in July - September quarter, this movement will become a factor to back up the demand for silico-manganese.

<> Charge chrome = Stainless steel companies in Japan have also agreed to a rise of price for South African charge chrome to be shipped in April - June quarter. This rise of the price in Japan is the same extent as that settled in Europe and, accordingly, the new benchmark price of South African charge chrome for Japan comes to 144 US-Cents per lb. of Cr CIF for April - June quarter by a rise of 35 US-Cents. The quarter of April - June is that to start the yearly contract and the matter in question as focused on has been shifted to how to be possible to shrink an extent of the discount. For a reference, since the world economy in 2009 had been seriously depressed, the extents to discount were supposed to be 10 to 15%.

<> Silicon metal = The three provinces, located in west-south district of China, had suffered from a drought in winter season but this severe situation is now in the direction to loosen. In view of the facts that a rainfall has started in this district and price of Chinese silicon metal for export has risen, it has become possible for China to produce silicon metal by means of consuming electric power at high fees, which has been supplied with thermoelectric power generation by coal. Chinese silicon metal for export to Japan is now being offered at US$2,370 - 2,380 per metric ton CIF, having risen by US$50 per ton compared to that at the beginning of April. Reflecting an increase in production of silicon metal during a period of spring to summer, price of Chinese silicon metal usually falls in that time but there is a widely- spread opinion in the market that such worry will be not necessary for 2010. The reason is that the production of Chinese silicon metal in spring of this year was not in order, having caused to reduce a pressure on the supply situation of silicon metal in China.

<> Manganese metal = An accident occurred in an early part of this week at a leading plant in Huayuan district (having resulted in missing five workers), where is a man base in China to produces electrolytic manganese metal, and the authorities concerned is implementing the safety inspection. Therefore, all of plants to produce electrolytic manganese metal have been temporarily suspended to operate and are waiting the further notice to resume this production. Accordingly, many plants have held back to make new offers for export of electrolytic manganese metal for the time being. Under the situation as mentioned above, the price of this metal in domestic market of China has risen to a level of CNY15,800 - 16,000 per ton by a rise of CNY500 per ton. New price of Chinese electrolytic manganese metal offered for export is on a level of US$2,950 - 2,980 per metric ton FOB, having risen by US$80 - 100 per ton compared with that at the end of March. It is not known yet how long does this suspension of the operations continue and, consequently, price of Chinese electrolytic manganese metal is anticipated to rise further.

<> Molybdenum = LME launched from the 22nd of February to trade molybdenum oxide for future deliveries but the transactions have still continued on a low level. The trade of molybdenum oxide at LME for future deliveries is compared with the active one on cobalt, which has recently issued warrant. The reason, why molybdenum oxide is being traded at LME on a sluggish tone, is supposed to be due to the matters, which major molybdenum mines are holding back to take the procedure for qualification of their molybdenum grade and listing on LME. Also, the actual transactions on cash base are scheduled to commence from May and, therefore, the parties concerned are watching carefully about further movements of price for molybdenum oxide. On the other hand, the traditional trades have been made on cash base and price of molybdenum oxide on this manner is rising gradually on a basic tone. The current price of molybdenum oxide is on a level of approximately US$18 per lb. of Mo by a rise of US$0.80 from that at the end of March. No new project to increase molybdenum production is scheduled to materialize in 2011 to 2012 and the world situation on supply of molybdenum is anticipated to tighten further from the second half of 2010.

<> Ferro-vanadium = Dealers are currently trading ferro-vanadium at US$32 - 34 per kg. of V CIF Japan, having remained as unchanged from the last one.
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last modified : Wed 21 Apr, 2010 [10:37]
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