TEX reported that the risen prices of ferroalloys in domestic market of China turned to weaken on a basic tone from the middle of November 2010 but, in view of a change of the monetary situation which Chinese enterprises managed necessary funds to tide over the year end, the parties concerned are moving to feel that the current prices of Chinese ferroalloys in domestic market will soon bottom out. Domestic price of silicomanganese is hesitating to fall further and, under the situation which actual cargoes of Chinese ferrosilicon are tightening, domestic sales of ferrosilicon for realization are going to cease.
Therefore, in anticipation of a further fall of price for ferrosilicon, Chinese suppliers had once taken a bearish attitude for sales of ferrosilicon but the circumstances surrounding domestic prices of Chinese ferroalloys are changing.
Domestic prices (per tonne of material delivered to plants) of Chinese ferroalloys as of January 10th 2011 are ferrosilicon: at CNY 7,050, silicomanganese: at CNY 8,000, high carbon ferromanganese: at CNY 7,700 and high carbon ferrochrome: at CNY 9,000.
This domestic price of Chinese ferrosilicon is still lower than that prevailed in last week but an extent of the fall shrunk to CNY 50 per tonne. Owing to the drastic sales of ferrosilicon for realization by speculators, domestic price of Chinese ferrosilicon in December 2010 had fallen considerably but it was also informed that actual cargoes of ferrosilicon in China are becoming scarce. Reflecting the cut of electricity supply enforced in October too December of 2010, the production of ferrosilicon in Ningxia Hui Autonomous Region had been seriously hampered and, according to an information, Ningxia Hui Autonomous Region is supposed to have a possibility to be cut again electricity supply from new year.
In relation to the fact that, because of the hindered transportation of coal emerged from a heavy snowfall, the volumes of electric power to be generated in Ningxia Hui Autonomous Region are not enough for its requirements and necessary to relieve this shortage of electric power, it has been talked about that Ningxia Hui Autonomous Region, where is the area to generate a substantial volume of electric power, may have a possibility to be requested to accommodate electricity for other districts.
Domestic price of silicomanganese in China has ceased to fall further and stayed at CNY 8,000 per tonne. At a tender held recently by a major steel company of China to purchase silicomanganese, the lowest price bidden was CNY 8,200 per tonne by a rise of CNY 50 per tonne. On the other hand, the price of Chinese silicomanganese offered for export has fallen to a level of USD 1,500 per tonne FOB but the price of Indian silicomanganese for export has continued to keep a low level of USD 1,300 per tonne CIF Japan. Accordingly, the price of Chinese product is still unable to compete with that of Indian product.
Domestic price of high carbon ferrochrome in China has been improved from the beginning of new year. At a tender held recently by a leading steel company of Chine to purchase high carbon ferrochrome, the lowest price bidden was CNY 9,000 per tonne of material by a slight rise. Reflecting an aftereffect of the fallen price for high carbon ferrochrome prevailed in China, the benchmark price of South African charge chrome for shipments to Europe in January to March 2011 quarter has been settled by a reduction of 5 US Cents per pound of Cr and, from this point of view, the suppliers concerned with Chinese high carbon ferrochrome are requested to take an attitude to improve domestic price of this ferroalloy in the course of 2011.
For a reference, by taking into consideration of the damage from a heavy snowfall, the price of Chinese electrolytic manganese metal offered for export in the beginning of 2011 has risen to a level of USD 3,600 to USD 3,700 per tonne FOB by an increase of USD 200 to USD 250 per tonne from that at the end of 2010.
(Sourced from TEX Report Limited)
