China's widespread power availability issues, which have been crippling industrial operators for months, highlight what could be a fundamental shift in the ferro-chrome smelting capacity coming out of the country, sources have said.
China's ferro-chrome production has been stalled by electricity restrictions because power providers have had to cut back output in response to the soaring price of coal, the country's largest fuel source.
The government has also imposed limitations on alloy production activity in a bid to improve the country's carbon footprint and improve air quality.
At the root of the issue is a combination of elements that, together, have greatly restricted the availability of power.
China has been importing substantially less coal from Australia, its leading source of foreign coal, owing to a trade spat between the two countries earlier in the year. With Australia accounting for more than one third of China's total coal imports, this has created a gap that supplies from other origins could not fill, which in turn led to an immediate shortage of feedstock for coal-fired power plants.
China has also been...