Indian high carbon FeCr(Ferro-Chrome) prices rose to a two-month high this week on the back of output cuts at local producers.
Prices for HC 60pc grade FeCr prices increased to 109,000-110,000 rupees/t ($1,308-1,320/t) ex-works on 18 June from Rs106,000-107,000/t on 13 June, hitting the highest level since 15 April.
Supply has been tight for a few weeks because some producers turned their focus toward manganese alloy production, and others cut production because of subdued demand from the stainless steel sector. A large FeCr producer has also halted offers, further limiting the already-tight spot supply.
"Some producers opted for production cuts, while others shifted focus to manganese alloy production as it offered better returns despite the higher production costs," a producer said.
Market participants expect the upcoming June chrome ore tender from state-owned mining firm OMC to provide clarity on the price outlook for FeCr. Many FeCr producers anticipate FeCr prices to move even higher if OMC lifts prices further in its June tender. "But if [the OMC tender price] does not increase, then FeCr prices may remain rangebound," another producer said.
State-owned trading firm MSTC on 21 May offered on OMC's behalf 37,300t of chrome ore from the South Kaliapani and Sukrangi mines. The base price for 48-49.99pc-grade ore from its South Kaliapani mines was Rs19,022/t, down from Rs19,897/t in its April tender. The company did not sell 50-51.99pc grade ore from its Sukrangi mines in the May tender.
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