NSSC Agrees to 8.4% Higher Ferrochrome Price

Nippon Steel & Sumikin Stainless Steel (NSSC) agreed with Samancor Chrome last week to increase the ferrochrome purchase price by 8.4% for April-June shipment from January-March. The price renews record of January-March. The suppliers sought more than 10% hike under tight supply due to the ore export control by Indian government. NSSC accepted the hike to secure requirement for stables stainless products supply. The higher chrome price could lift the stainless price. The new ferrochrome price is 93 US cents per pound of chrome, which represents US$ 1,032 per tonne for product with 52% chrome, for April-June. The price is 7 US cents higher than January-March. The quarterly price was record again in October-December 2006 and January-March 2007 as April-June 2005 after temporally drops from July 2005 to September 2006. The suppliers tried to increase the price by more than 10 US cents per pound of chrome. However, they reduced the gain to keep long term relationship with major users. Chrome ore supply got tighter after Indian government imposed 2,000 rupee per tonne of export ore to keep the resources for domestic consumption. The tight ore supply lifted the spot market price in China, which depends on India for a third of chrome ore consumption. The ferrochrome supply is expected to keep tight due to lower output caused by lower Indian ore supply despite of higher output by South African suppliers.