[SMM Daily Review] Ferrochrome Market Operates Stably, Chrome Ore Prices Remain Relatively Weak

On May 26, 2025, the ex-factory price of high-carbon ferrochrome in Inner Mongolia was 8,000-8,100 yuan/mt (50% metal content). In Sichuan and north-west China, the ex-factory price of high-carbon ferrochrome was 8,100-8,200 yuan/mt (50% metal content), unchanged from the previous trading day. The ferrochrome market remained stable during the day, with limited actual transactions. Recently, a high-carbon ferrochrome producer in Inner Mongolia halted production at a 30,000 KVA submerged arc furnace, planning a one-month maintenance period, which is expected to reduce monthly ferrochrome production by approximately 5,000 mt. According to an SMM survey, some ferrochrome producers halted production for maintenance in May, but production resumptions were more active, leading to a significant increase in ferrochrome supply. Sichuan and other regions are about to enter the rainy season, with lower production costs due to advantageous electricity prices. Coupled with sufficient chrome ore inventory built up earlier, there is a higher willingness to resume production. Additionally, considering the news of production cuts in downstream stainless steel, the demand for ferrochrome may continue to decline, posing a further risk of price drops for ferrochrome. However, with chrome ore prices still high, cost control limits the downside room for ferrochrome prices. It is expected that the ferrochrome market will operate generally stable with slight fall in the short term.

On the raw material side, the chrome ore market was in the doldrums today, with bearish market expectations and limited purchase transactions. On May 26, 2025, the spot price of 40-42% South African powder at Tianjin Port was 61-62 yuan/mtu, with futures prices at $290-300/mt. The price of 48-50% Zimbabwean powder was 62-63 yuan/mtu, with futures prices at $350-360/mt, unchanged from the previous trading day. A new round of futures quotes from major overseas chrome ore miners landed at a flat price of $295/mt, providing some support to the spot prices of South African chrome ore. Meanwhile, due to the concentrated supply of South African powder, traders showed relatively high reluctance to budge on prices. However, influenced by the risk of falling retail prices of ferrochrome, the market held a bearish view on future prices. Traders of Zimbabwean chrome ore and other mainstream chrome ore were unstable in sentiment, lowering their quotes and offering discounts to facilitate sales. However, ferrochrome producers still maintained a certain level of raw material inventory, so they remained cautious in purchases, resulting in limited actual transactions of chrome ore. It is expected that the chrome ore market will operate generally stable with slight fall in the short term.