Supply and demand situation in Japan of major ferroalloys (ferromanganese, ferrochrome, ferrosilicon etc) during the Q1 (January to March) of 2012 was as per the table attached hereto. Review of the figures tells that ferrosilicon and silicomanganese were comparatively tight during the quarter, although their prices in US Dollars stayed weak under the continued sluggish international market situation, in addition to the stronger yen currency.
Ferromanganese
Most of Japan's demand is supplied domestically. In preparation for the forecasted power rate rise within this year, Japanese producers produced a lot more in the Q1 2012 than in normal quarters, resulting in an apparent oversupply, a big gap between the supplies including imported materials and the consumption as shown in the attached table.
Ferrosilicon
Comparison of supplies and consumption at both steel making sector and at iron casting sector gives an apparently well balanced situation. Consumption at the steel making of 88,785 tonnes plus consumption at the iron casting i.e. 20% of the quantity consumed for steel making makes about 106,000 tonnes in total as an estimated total consumption, which is almost in the same level as the imports (supplies) during the quarter. Prices stayed soft due to the inflow of the detoured cheaper Chinese material through Vietnam at USD 1,350 to USD 1,370 per tonne CIF as compared to the price of USD 1,400 per tonne or more for the directly imported materials from China.
Silicomanganese
Apparent supply, the sum of domestic production and imports was 75,466 tonnes, some more than the consumption of 69,760 tonnes. It is a bit difficult, however, to figure out more realistic supply demand balance of silicomanganese from these figures only, because trading houses in distribution flow of this alloy are more influential over the market as they carry stocks acutely reacting to market sentiments. During the Q1 especially, prices had stayed weak since last year end, once in January at below USD 1,000 per tonne CIF for the Indian material. Market was therefore loose based on abundant availability of Indian materials.
Ferrochrome
Consumption of high-carbon ferrochrome was 164,812 tonnes as compared to the imports of 157,373 tonnes. However these figures do not mean that the market was tight. It was rather loose. The mills, suffering from fairy high level of inventory had already started to reduce inventory. Besides, they had already been in production curtailment since the Q4 (October to December) of 2011 and trying to reduce imports as much as possible for the expected less demand.
Nevertheless, end March 2012 inventory at the mills was 84,583 tonnes, much higher than 63,754 tonnes a year ago.
Source - TEX Report Limited
(www.steelguru.com)
