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|Market Trend of Import of Ferroalloy as of 30 June 2016|
|= Prices of silico manganese and molybdenum continue declining =|
The market trend of import of ferroalloy as of 30 June 2016 is as follows.|
<> Silicon Metal = The price of silicon metal in China stops declining at the present moment. Some producers raised the offer price in expectation of price repelling power, but the contract price does not rise so much due to weak actual demand in the Chinese domestic market.
The operating rate in the main producing areas like Yunnan and Sichuan went up a bit and the production volume is also expected to go up, but there is an area where the production came down as a contrary case, which leads to the present supply being balanced with weak demand. For that reason, the offer price for export won't go down further.
In the Japanese domestic market, as the customers show reluctance to buy at a high price and strengthen a price downward pressure, many of the shippers are having a hard time with the price negotiation. Most of the contract prices were remaining almost unchanged from the previous time.
<> Ferro-silicon = In the Chinese domestic market, the situation of the demand and supply being balanced is ongoing because of the continuation of the production curtailment in Ningxia Hui as a main producing area and the poor production in Qinghai. Besides, there is another information that a major producer in Ningxia Hui suspended production, and such a forecast comes up to the surface as the spot goods of the product with Si being 75% and high-purity product will become scarce in the future. For that reason, many of the ferro-silicon producers which continue operation take a strong attitude and raised the offer prices for both export and domestic consumption. However, the price in US currency is balanced out by weak yuan and becomes almost same as the price in the middle of June.
What's more, the large-scale strict control over the illegal export was exercised, and more than 3,700 people were arrested. As many of the roundabout routes including via Vietnam are thought not to be recovered for the time being, there is a possibility that Chinese cheap products will disappear from Japan, South Korea, Taiwan, India and so on.
In the Japanese domestic market, the purchase price of the regularly imported product maintained to be unchanged due to the price increase in the purchase price being balanced out by weak yuan. The prices of products distributed in the market can't be raised due to the price competition with Russian products although the distributed quantity of cheap products is limited.
The price of Russian product becomes stable partly because the tenders for long-term contracts slowed down. Many of market participants analyze that there won't be a big movement in the ferro-silicon market in Japan during July.
For reference, Pertama Ferroalloys, Malaysia successfully had a first tapping of ferro-silicon on June 15. This is the second ferro-silicon producer at the Samalaju Industrial Park, Sarawak and the people concerned expect discharging in Japan with the year.
<> Silico Manganese = As the price of manganese ore imported as July shipment dropped, the feeling of an anticipation of a price fall becomes strong in India. For that reason, some producers seem to move to be among the first to secure the contract by lowering the offer price for August shipment. As the rupee is weak against US dollar, the offer price meant fro Japan dropped by US$20 from the end of May. On the one hand, the contract price in Japan shows a tapering down trend due to the stagnating demand.
The price in China stopped declining in the last week of May, and still remains unchanged even as of June 30. The producers' stoppage of operation prevail due to the stagnating price, and the demand is weak although the distributed volume in the market decreases, which leads to the demand and supply being almost balanced. However, market participants expect a drop in the price of imported manganese ore will lead to a drop in the price of silico manganese. The export of Chinese silico manganese to Japan did not seem to be contracted this time, either.
<> High-carbon Ferro-chrome (including charge chrome) = The price of South African charge chrome for the period from July to September meant for Europe was fixed by being up by US Cents 16 per lb from the prior period on June 22. Many of market participants were surprised at a bigger price hike than expected.
In the market, such things are analyzed to be reasons for the above as (1) Many of ferro-chrome producers in South Africa have applied for business rescue due to aggravating profitability, which leads to a drop in the operating rate, (2) The production in the period from July to September in South Africa decreases due to the increase in the electricity rate, and the production volume is anticipated to be drastically down, (3) On the one hand, as of June 22, the stainless steel production in Europe was forecast to be firm and (4) The using ratio of high-carbon ferro-chrome is up because the generation of nickel-containing stainless steel scrap (SABOT) decreases.
On the one hand, the negotiation on the contract price of high-carbon ferro-chrome for the period from July to September is still going on and anticipated to come to an agreement in July. Many of market participants think the price will be up by US Cents 16 from the prior period as is the case in the benchmark for Europe.
In Japan, the situation of no trading of spot goods of high-carbon ferro-chrome having been clinched is still going on.
<> Low-carbon Ferro-chrome = The regular price for the period from July to September is fixed unchanged from the prior period. This is because the price of Chinese product which caused a price drop in the prior period rose to a large extent and the import volume came down, which resulted in the prices of both domestic and imported products becoming stable. Besides, the troubles as to the Chinese products arising from delayed shipments are not a few, which leads to some customers refraining from Chinese products.
Partly because the negotiation on the regular price just came to an agreement, the trading of the spot goods was thin, and there was no big movement in both offer and contract prices.
<> Molybdenum = The molybdenum price spiked during April to May, but showed a downward trend during June and the prices of molybdenum oxide and ferro-molybdenum were down by 8 - 9% from the end of May, which is largely due to a drop in the domestic price in China as the biggest market.
On the one hand, LME molybdenum price (cash seller and settlement) is US$17,000 per ton (= US$7.71 per lb), up by US$1,700 (= US$0.77 per lb) from the end of May.
<> Manganese Metal = In China, the price has had no movement since late May, and continued to hover at a bottom price. Many of market participants see the price meant for the domestic market won't go up at least until the end of July. On the one hand, there has been no big movement in the price for export for such reasons as (1) The cheap roundabout products via Vietnam got scarce which was thought to be one of the reasons for price competition in the Asian market, (2) The producers in Ningxia Hui which have exerted traction on cheap prices up until now cannot offer a cheap price and (3) The price of manganese ore of Chinese origin as raw materials stops declining. However, the producers raise an offer price and Chinese yuan becomes weak against US dollar, which leads to the reduced difference between higher and lower quotations.
The demand in Japan is still weak, but the movements vary according to the customers, and while there is a contract at around US$1,500 per ton within a lower quotation range, a contract at US$1,560 can been seen within a higher quotation range.
|last modified : Thu 07 Jul, 2016 [09:37]|