B2B Portal for Technical and Commercial Foundry Management
Languages

Foundry Daily News

27. May 2009

China becomes net ferroalloy importer in first 2 months

According to the customs-statistics released in China, the quantities of ferroalloys imported and exported by China in January to February of 2009.

China imported 242,211 tonnes of ferroalloys and also exported 177,697 tonnes of ferroalloys in January to February of 2009. China was so far the country to export more ferroalloys but as far as the quantities traded by China in January to February are concerned, the total quantity of ferroalloys imported by China in the first 2 months of 2009 had exceeded that exported by China in the same period.

The reason is due to the extraordinarily lowered level of exports and, since price of high carbon ferrochrome produced in China has now come to be higher than those produced in South Africa, India and Kazakhstan the imports of high carbon ferrochrome into China have increased to a considerable extent, resulting in the phenomenon as mentioned above. The prices of ferrosilicon and silicon metal produced in China have still kept a power to be competitive on exports and, when these exports are recovered, this phenomenon has a probability to disappear from the market.

However, as far as chrome and manganese based ferroalloys are concerned, China has to rely chrome and manganese ores as raw materials on imports and are the country to export these ferroalloys under conversion trade on consignment. Owing to the facts that China has been renovating the systems and strengthening the countermeasures for environmental pollution and the inflation in China has caused to rise prices of raw materials, the advantages of such costs as lower electric power fee, lower labor cost, lower transportation freight and rebate for conversion trade, which China had held in the past years, are in the direction to be losing gradually. Therefore, such case as that, China has shifted nearly half of their demand for ferrochrome to imports has come up to the surface.

The matters, which prices of ferrochrome in the international market have sharply fallen and the steeply decreased demand for ferrochrome from western countries has caused a trend to sell more ferrochrome to China as the kingdom of stainless steel, have come to be remarkable and deepened further its degrees from the beginning of 2009. The unit prices of ferrochrome imported into China in February of 2009 and calculated from the values cleared the customs were

1. High carbon ferrochrome at 62.78 US Cents per lb of Cr CIF on Cr 65% base of Cr CIF on Cr 50% base

2. Low carbon ferrochrome at 93.5 US Cents per lb of Cr CIF on Cr 65% base.

In view of the facts that China imported considerable quantities of chrome ores at higher prices in 2008 as raw material and has been suffering from high cost for raw material, the cost price to produce high carbon ferrochrome in China is estimated to be higher than 65 US Cents per lb of Cr. The western suppliers are supposed to have taken the offensive to sell high carbon ferrochrome for China at lower prices than 60 US-Cents per lb. of Cr CIF in February to March of 2009.

The case of silicomanganese is not the same as that of ferrochrome but China imported silicomanganese at USD 871 per tonne of material CIF in February of 2009 and this price level is fairly lower than that at which China exported silicomanganese produced by themselves. Chinese silicomanganese has been offered for Japan at USD 1,300 per metric ton CIF but when export duty of 20% and ocean freight are deducted from this CIF price, its FOB price comes to USD 1,050 per metric ton. Therefore, the price of silicomanganese imported into China is cheaper than that of

The unit price of manganese ore imported into China in the second half of 2008 was higher, having caused to increase the cost for production of silicomanganese in China. Indian silicomanganese is currently being offered at USD 1,100 per tonne CIF Japan, which is USD 200 per ton lower than that of Chinese product.

South Africa, India and Kazakhstan are the countries to produce raw materials for manganese-based and chrome-based ferroalloys and, in view of a depression of the markets at present, the matter in question is whether Chinese products are able to compete with those produced in the three countries as mentioned above or not.

Related Articles

Youtube Google+ Linkedin Xing