Trend analysis of domestic high-carbon ferrochrome
The characteristics of the price trend of high-carbon ferrochrome in 2021: 1. The price of iron is obviously driven by policies, and the volatility is widening. 2. The price hit a new high in recent years and remained high overall. In 2021, the average annual price of high-carbon ferrochrome will be 8,875 yuan/50 basis tons, a year-on-year increase of up to 52%.
The first quarter: Energy consumption work in Inner Mongolia started, and factory production restrictions triggered a shortage of ferrochrome supply. The superimposed cost has risen sharply, steel mills have strengthened production schedules and other favorable factors, and the price of ferrochrome has ushered in a “warm sun” market.
The second quarter: Attracted by high profits, the factory resumption camp expanded, and the supply of ferrochrome rebounded significantly. However, the conversion of stainless steel production led to a decline in demand, and iron prices returned to the downward adjustment channel.
The third quarter: the national electricity shortage caused power shortages in many production areas, and at the same time, the import volume of ferrochrome decreased, energy consumption work was carried out in other provinces, the contradiction between supply and demand of ferrochrome intensified, and the iron price skyrocketed, reaching the highest point of 11350 yuan/50 basis tons in the year .
The fourth quarter: Coke prices fell sharply, and cost support weakened. The profits of power plants were restored, power cuts ended, new ferrochromium production capacity was accelerated, and steel mills concentrated on reducing production, the situation of strong supply and weak demand was established, and iron prices fell sharply.
Trend Analysis of Imported High Carbon Ferrochrome
The first quarter: Overseas demand recovered, and the price of ferrochrome entered an upward cycle. Due to the gap on the supply side, the willingness of domestic steel mills to build warehouses is obvious. Similar to the trend of domestic iron, the increase of imported high-carbon ferrochromium is not inferior.
The second quarter: Although the price of ferrochrome in the European market continued to rise, with the increase of enterprises resuming production, the shortage of raw materials was relieved, and the price of imported iron exported to China followed the downward trend of domestic iron prices.
The third quarter: Due to the reduction of domestic ferrochrome production due to power cuts, the demand for imported iron has strengthened again, and the prices of imported high-carbon ferrochrome and domestic high-carbon ferrochrome have been able to rise alternately.
The fourth quarter: domestic ferrochrome has reached a new high, coupled with the stimulation of high prices in overseas markets, imports of high-carbon ferrochrome only retain long-term contracts. In the zero-order market, quotations and transactions are often in a vacuum due to the psychological price difference between buyers and sellers.
Trend analysis of low micro carbon ferrochrome
In 2021, the average annual price of low-carbon ferrochrome will be 15,353 yuan/60 basis tons, a year-on-year increase of 51%. The annual price difference reached 12,450 yuan/60 basis tons, and the phenomenon of sharp rise and fall is relatively common.
In the first quarter, the market inquiry activity was high, steel mills concentrated on stocking, and low-micro-carbon ferrochrome “rising all boats”. Under the dual support of cost and demand, iron prices started to rise.
The second quarter: the market sell-off behavior caused the iron price to drop rapidly, during which time it returned to the level before the price increase. Then steel mills over-purchased, iron prices bottomed out and rebounded, ushering in an inflection point in the market.
The third quarter: The price of silicon chromium “takes off”, the cost rises sharply, and the supply of low-carbon ferrochrome shrinks, and the price of iron rises again.
The fourth quarter: In mid-October, it reached the highest point of 23,200 yuan/60 basis tons in the year. However, due to poor demand follow-up, the price fell “cliff-like”, and fell below the factory cost line.