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China's Baosteel rolls over Nov ferrochrome purchase price: sources

https://www.chemnet.com   Oct 29,2014 Platts
China's Baosteel has kept its domestic high carbon ferrochrome purchase price unchanged month on month at Yuan 6,400/mt (equivalent to 79 cents/lb) for November deliveries, industry sources said Tuesday.

The price settled between Baosteel and ferrochrome suppliers on Monday was for cash payment and includes 17% value added tax.

This is the first time Baosteel has rolled over its ferrochrome purchase price after cutting its monthly prices - on a month-on-month basis - for the past eight consecutive months.

Officials from Baosteel's raw material department could not be reached for comment Tuesday.
The market is still waiting for the country's two other major stainless steelmakers -- Shanxi Taigang Stainless Steel and Jiuquan Iron & Steel -- to decide on their November purchase prices.

Some sources said that Chinese ferrochrome prices are close to, if not already at, a bottom.

"The other steelmakers are likely to roll over prices as well but we're not ruling out Taigang cutting prices by another Yuan 50/mt," said Beijing Antaike's ferrochrome analyst, Liu Yujing.

"Nonetheless, ferrochrome prices should bottom out in November," she said, noting that the market would see support from production cuts in Inner Mongolia and in southern China where the dry season has started.

Power rates in the hydropower-dependent south typically rise from the end of October and as a result, ferroalloy producers usually cut production.

But while ferrochrome prices are likely near a bottom, Chinese stainless steel prices are not likely to have bottomed out yet as nickel metal and Chinese nickel pig iron prices are still trending lower, and stainless steel demand remains weak, said an official with an East China stainless mill.

"Most people see the stainless market weakening further. There are no positive factors in the stainless market now," he said.

The stainless steel industry is the largest consumer of high carbon ferrochrome.
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