In June, China's high-carbon ferrochrome imports reached 330,400 mt, exacerbating the oversupply and weakening high-carbon ferrochrome prices [SMM Analysis]

According to Chinese customs statistics, in June 2024, China's high-carbon ferrochrome imports amounted to 330,400 mt, up 18,600 mt MoM (+5.97% MoM) and up 199,100 mt YoY (+151.58% YoY). From January to June 2024, China's total high-carbon ferrochrome imports reached 1.9444 million mt, up 363,000 mt YoY (+22.95% YoY). China imported 170,900 mt of high-carbon ferrochrome from South Africa and 119,500 mt from Kazakhstan. In June, the volume of high-carbon ferrochrome imported through general trade was only 226,400 mt, while those through bonded supervising places and special customs supervision area accounted for 104,000 mt. In June, high-carbon ferrochrome exports were 30,000 mt.

According to SMM, despite the high bidding prices by steel mills recently, high-carbon ferrochrome imports remained at a high level. Meanwhile, domestic high-carbon ferrochrome production in June reached a historical high of 800,000 mt, further exacerbating the domestic oversupply. Although exports increased significantly by 11,447% YoY, net imports still reached a high level of 300,400 mt. Recently, though August bidding prices dropped by 100 yuan/mt (Cr50%), the operating rate is not expected to decline significantly as domestic high-carbon ferrochrome producers can still accept the prices. The domestic oversupply of high-carbon ferrochrome is unlikely to be resolved in the short term. As stainless steel demand for high-carbon ferrochrome remained decent and provided some support for costs, high-carbon ferrochrome prices are unlikely to fall significantly in the short term, but the overall market is expected to weaken.