FOCUS: Ferro-vanadium discounts to widen; 2021 contracts vols to dip amid Covid-19 uncertainty

Suppliers are offering wider discounts in early negotiations for long-term ferro-vanadium contracts for 2021 compared with 2020 on an uncertain steel demand outlook amid the ongoing Covid-19 pandemic, market sources told Fastmarkets.

Long-term contracts for ferro-vanadium in Europe are usually settled against Fastmarkets' European benchmark price assessment with the parties agreeing a discount to the published price to take prevailing market fundamentals into account.
Preliminary negotiations for some ferro-vanadium contracts have started at around 4-4.5% for 2021 at the midpoint of Fastmarkets quotation, market sources said. While contract negotiations continue this month, long-term formula discounts should widen on an annual basis, with some contracts heard to have already signed a 6-8% discount.

Last year's discounts were agreed at around 5-7% against third-party ferro-vanadium prices, depending on credit terms, volumes and the timing of the negotiations, trading sources said. The discount has been around 5-7% or even in double-digit...

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