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Market Trend of Import of Ferroalloy as of 31 March 2016
= Prices of Chinese Si metal, EMM and Indian SiMn are rising =
The market trend of import of ferroalloy as of 31 March 2016 is as follows.

<> Silicon Metal = The price of silicon metal in China has begun taking an upward turn since Chinese New Year finished, and still continued rising. The price of 5.5.3 low-grade product is up by CNY900 - CNY1,000 per ton from the end of February and the price of 4.4.1 grade is also up by CNY700 - CNY800. The operating rate in the main producing areas like Yunnan and Sichuan during March is reported to be less than 10%, but the demand in China is firm and a feeling of tight supply has been growing in the market. Many of the producers in Yunnan and Sichuan are scheduled to restart the plant during June to July, and there is a possibility the feeling of the tight supply in the market will continue for the time being. Some market participants anticipate the price to continue rising during April.

In Japan, in keeping with a price increase in China, both offer and contract prices have gone up drastically. The contract price is up by US$190 - US$210 from the end of February.

<> Ferro-silicon = In China, the steel mills have begun the tender for April purchase (product with Si being 72%), but a few middle-ranking companies have already come to an agreement with a price being up from March. The spot market for both products with Si being 72% and 75% calmed down, and the price dropped from the highest figure during March, but the inventory in the market and producers' in-hand stocks are still scarce, which leads to a strong resisting power against a price cut. The offer price and main price of the product with Si being 75% are CNY4,900 - CNY5,000 per ton, up by CNY400 from the end of February. Some of the shippers in Japan and South Korea encountered non-delivery and negative margins due to a price hike during March. Even at the present moment, there are shippers which have difficulties in securing spot goods, and the cheap products in the market seem to have got scarce completely.

As to the price of Chinese ferro-silicon in the Japanese market, the price of regularly exported product has been adjusted and lowered by around US$10. As to the products distributed in the market, it becomes difficult by being swayed by the confusion in China to predict a future price, and many of the shippers have raised offer prices by way of taking safety measures. As to roundabout products, there was a cheap price of far less than US$950 in the recent tender, but many of the market participants analyze this product other than that stocked at home as a risky cargo .

The price of Russian product was lowered as is the case in the last time. Both offer and contract prices are down by US$50 from the end of February. Against a background of weak ruble, the price is showing a different movement from other sources.

<> Silico Manganese = In the first week of March, the European Commission announced that no antidumping duty would be imposed on Indian silico manganese. Combined with no antidumping duty being imposed on Australian silico manganese by North America, the excessive concentration in the Asian market has been averted. On the other side of the coin, the supply has become tight as a result of decreased production in India, and the producers in India have raised offer prices to a large extent. Partly because the retail price of imported manganese ore remains at a high level, the main offer price is around US$950 per ton CIF, and the offer of more than US$1,000 has appeared occasionally. For that reason, the contract price of Indian product goes up drastically and is up by around US$95 from the end of February.

In China, the panic buying slowed down, and the price dropped back from the high prices at one time. The main price of Inner Mongolian product is CNY5,600 - CNY5,800, down by CNY100 - CNY200 from the highest price during March. It seems no export contract was made for Japan.

<> High-carbon Ferro-chrome (including charge chrome) = On March 18, the benchmark price for South African charge chrome meant for Europe was settled at US Cents 82, down by US Cents 10 from the prior period. Many of the market participants cannot dispel the confusion about a larger price cut than expected in the market.

On March 24, Mitsubishi Corporation posted a loss of JPY20 billion incurred by its ferro-chrome business in South Africa. This is a matter of Hernic Ferrochrome Pty Ltd. in which Mitsubishi has a 51% interest, and in the market, Hernic Chrome is believed to have posted a loss of about JAP40 billion (= about US$356 million). Mitsubishi's announcement provides a drop in the ferro-chrome price as a factor for having no other alternative but to post a loss.

On the one hand, the negotiation on the contract price of high-carbon ferro-chrome for the period from April to June meant for Japan is still going on, and it is quite likely the settlement will be put off until April. Supposing the price is down by US Cents 10 from the prior period as is the case in Europe, the price will be US Cents 90.

For a reference, the situation of almost no trading of spot goods of high-carbon ferro-chrome having been clinched in Japan is going on.

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last modified : Wed 06 Apr, 2016 [09:44]
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