Ferrochrome Quarterly Price Jumps by 20%

Ferrochrome price quarterly negotiation was concluded to increase by 20% in Europe for July-September from April-June. The price renews the record high for 2 consecutive quarters. Japanese stainless makers still seek moderate hike citing Asian demand could decrease when makers plan output reduction. Ferrochrome spot market price surges due to Chinese aggressive purchase along with worldwide stainless demand increase. The ferrochrome price hike represents 8,800 yen per tonne of higher cost for stainless steel products with 18% chrome. Ferrochrome major, Xstrata agreed with European stainless makers to increase the price by 18 US cents per pound of chrome. Japanese stainless makers will accept certain hike but try to reduce the increase when Asian ferrochrome demand could decrease when Chinese stainless makers reduce the output. Chinese stainless steel output is expected to increase in 2007 from 5.3 million tonnes in 2006 when Chinese major makers expanded the output capacity since late 2006. Ferrochrome spot market price surged to as high as 150 US cents per pound of chrome, according to Japanese sources when China increases the ferrochrome import due to limited availability of chrome ore. Asian ferrochrome demand depends on the output reduction announced by Chinese major makers. World stainless makers shift from nickel series stainless to chrome series products under higher nickel price. Nickel ingot price at London Metal Exchange dropped to US$ 36,800 per tonne on Wednesday, which was 32% lower than record on May 16. The shift to chrome series is likely to continue when the nickel ingot price is still higher than the beginning of the year level and nickel series stainless price keeps high level.