TEX reported that let us trace the movements on supply and demand of ferrochrome in Japan for April to June quarter of 2009. Following the largest reduction in production of stainless steel for January to March quarter of 2009 as recorded in its history, the quantities of ferrochrome consumed in Japan for April to June quarter were high carbon ferrochrome: 108,926 tonnes as compared with 204,119 tonnes for the same quarter of 2008 and low carbon ferrochrome: 7,026 tonnes as compared to 13,670 tonnes for the same quarter of 2008, both of which decreased to the half of those for the same quarter of 2008.

The quantities of high carbon ferrochrome and low carbon ferrochrome produced, imported and shipped by Japan in the second quarter of 2009 were as per the table attached hereto.

However, these movements in consumption of ferrochrome for April to June quarter were improved and recovered in comparison with those actually consumed for the preceding quarter of January to March but the production of stainless steel in question for April to June quarter of 2009 still had a considerable decline of 45% from that for the same quarter of 2008. In addition, the output of special steel products in April to June quarter to be delivered to the automobile industry of Japan also decreased to half of that in the same quarter of 2008 and a reduction in production of special steel products, as the main base to consume ferrochrome, had put a considerable influence on consumption of ferrochrome in Japan for the quarter.

A decline in consumption of ferrochrome by Japan had put the utmost impact on imports of ferrochrome and, as a matter of fact, the quantities of ferrochrome imported into Japan in April to June quarter of 2009 were high carbon ferrochrome: 74,290 tonnes as compared with 270,003 tonnes in the same quarter of 2008 and low carbon ferrochrome: 6,794 tonnes as compared to 23,625 tonnes in the same quarter of 2008.

According to a forecast released in last week by Societe General of France, the world production of crude stainless steel in 2010 is expected to be 29 million tonnes per annum by a substantial expansion from that of 24 million tonnes to be produced in 2009.

(Sourced from TEX Report Limited)