Market participants expect to see a decline in the monthly tender price offered by major Chinese stainless mills for March delivery of domestic high-carbon ferro-chrome when the tenders are officially announced in the coming days. Fastmarkets examines the reasons behind this expectation and discusses how smelters might respond to the lower tenders.
It is important to note that the tender prices announced for February delivery, rolled over from the prior month, are already at multi-year lows. Fastmarkets' ferro-chrome contract 6-8% C, basis 50% Cr, ddp China, tender price was 5,600-5,800 yuan ($805-833) per tonne on February 28, unchanged since December 27, 2019. This is lowest since May 2016 basis a midpoint of 5,700 yuan per tonne.Sources pointed to subdued domestic demand for stainless steel products in China since the outbreak of the novel coronavirus (2019-nCOV) in the country at the start of the year as well as the looming threat to Chinese exporters after the virus spread to South Korea, the largest...