Market outlook of Japanese imported ferroalloys as of January 31st 2012 is as follows:
General view
World crude steel production in 2011 turned out 1,527 million tonnes, of which China's output held 45.5% at 695 million tonnes. With the dominatingly large share, the market of 2012 will revolve again around China. Last year output of crude steel in China continued to decline in October and November, but the decline stopped in December. In addition, the Chinese mills are said to resume buying iron ore in a large volume, giving some stir in the ocean freight market. Recovery is obviously near as the New Year opened.
Ferrosilicon
Market looks half asleep just after the Chinese New Year Holidays. In December cheap selling for cash softened the market without big changes after the opening of 2012. Offer prices before the Holidays were USD 1,400 per tonne CIF for Chinese origin and USD 1,380 per tonne CIF for so called Vietnamese origin.
Silicomanganese
The efforts by the sellers of Indian silicomanganese have been paid off as the cheap offers of below USD 1,000 per tonne CIF totally disappeared, but it is a bit premature to say that USD 1,100 per tonne or more as targeted by the sellers is being acknowledged as prevailing by the market. The highest offer of recent days was USD 1,130 per tonne CIF without takers. Actual deals are done at USD 1,080 to USD 1,100 per tonne CIF. It is of market concern whether the sellers' efforts will be rewarded in the near future or not, as there are many medium and small scale producers especially in India who tend to put priority on quick sales at a little lower price than trying to maintain higher prices. It is true that the market bottomed out at USD 950 to USD 980 per tonne, but some more time seems required before USD 1,100 per tonne or more becomes prevailing.
Charge chrome
Spot price of high carbon ferrochrome in Europe rose to USD 108 to USD 110 per pound DDP early January 2012. As the gap between the spot price and the benchmark narrowed, some market participants took it as a starting line of the road to benchmark raise for the Q2 by USD 10 to USD 15 per pound as sought by ferrochrome producers. Current concern of the market is definitely the price in the Chinese market after the Holidays, as it is now the very influential key factor for the world market of chrome. In Japan spot market has been just quiet. Japan's stainless steel mills in large-scale curtailment since November seem just busy in fulfilling the obligation of taking the tonnages contracted for 2011, having no room to buy spots.
Manganese metal
Upon opening of 2012, LME nickel price started rising to reach USD 20,000 per tonne recently. Nickel's price rise means, generally speaking, 200 series stainless steel products containing manganese become more attractive to consumers, therefore a market participant commented that manganese metal price would hopefully rebound after the Chinese New Year Holidays based on the possibility of increase in demand for the metal. However, things may not be so simple, because the output of crude SUS 200 series in 2011 was 4.75 million tonnes, up by only 1.3% from 2010, while the output of crude SUS 300 series (nickel alloyed) in 2011 grew by 21.2% from 2010. Maybe it will take time to see whether the high nickel price will actually favor manganese metal's demand price, or not so much. The offers just after the Holidays were at USD 3,100 to USD 3,200 per tonne CIF, which is said to be below the profit making line of the producers.
Molybdenum
The prices in the market late last week came to over USD 14 per pound, which was the level seen in the market in August 2011 last time. The market bottomed out in December 2011, since when the price had fluctuated within 13's for 3 to 4 weeks, but it picked up to over USD 14 per pound last week upon a sizable order from a European stainless steel mill. As a result, market sentiment turned a little tight, a well informed source commented.
(Sourced from TEX Report Limited)
