The weak trend in China of the high-carbon ferrochrome spot price has spread to Japan, where spot buyers, mostly special steel mills including stainless steel mills, apparently require the price of high-carbon ferrochrome price to be lowered to the similar level as seen in China. As a matter of fact, in a tender for high-carbon ferrochrome held recently by a major special steel mill, the winner's price was US$0.89/lb CIF.|
Earlier than the tender, the price in China already hit below US$0.90/lb, which is by now rather common in the tenders by major Chinese stainless steel mills. In such a situation, the US$0.89/lb sprang out in Japan, located a little further than to China from the originating country that is said to be India this time. Obviously the low price in China is now directly affecting the Japanese market.
The Q3 (July - September) benchmark price for Japan is US$1.33/lb CIF, but as discounts of 15 - 20% from the benchmark became common these days for quarterly contracts, the actual prices (after discount) have been reportedly in the range of US$1.06 - 1.13/lb. Therefore US$0.89/lb in Japan as an actually contracted price level, although in a spot tender, is surprisingly lower than the prices based on the benchmark, definitely affecting the Q4 (October - December) benchmark price setting.