November ferroalloys price insight

The trend towards a slower price rally in the global ferroalloys market, which started back in October, continues in November: prices in most segments stabilized, and some ferroalloys even went down in price.

However, it is too early to assume that there will be a global reversal in the price trend. Markets traditionally react with a drop in prices at the start of the long-term contracts campaign at this time of year. Additionally, in anticipation of the Christmas holidays, some sellers are seeking to unload inventory and free up cash, which also leads to discounts.

At the same time, the fundamental factors contributing to high ferroalloy prices globally remain. These include the high cost of transportation, energy resources, and decreased production of ferroalloys at many plants.

However, on the consumption front, the circumstances are not particularly encouraging. According to Worldsteel, October saw a YoY decline in global steel output of almost 11%, predominately driven by the and environmental restrictions is in China, where steel output dropped by 23% in October. EU countries, however, continue to show robust, by the standards of developed countries, growth of almost 6.5%.

Manganese and Silicon

The ferrosilicon market in Europe saw no noticeable price changes in November. Based on the Metalshub price index, the weighted average FeSi price fluctuated between 4-6% weekly during the month. On the one hand, the start of the long-term contracts campaign for 2022 contributed to price stabilisation, resulting in lower demand on the spot market, while indicative prices were fixed at previous levels. On the other hand, there remains a shortage of products with immediate shipment availability in the segment and high electricity prices have forced manufacturers to periodically shut down furnaces. For instance, Ferroglobe again shut down two units at its plants in Spain in the latter part of the month.

Based on the Metalshub price index, the weighted average price for HC FeMn (75% Mn min, 8.5% C max, 0.25% P max) fell by almost 11% in November. Market participants attribute this to alloy purchases for 2022 and discounts that large customers were able to get. In addition, a lower duty on ferroalloys exports in Russia made the Russian material more affordable in the EU.

In contrast, the price index for SiMn (65% Mn; 17% Si) rose in November amid a near halving of output at the Nikopol Ferroalloy Plant in Ukraine (the largest importer of the alloy in the EU) in September and October due to high electricity cost. The company announced the restart of idle furnaces in late November, but the supply in Europe will not be affected until January.

The resumption of sales by China's largest producer, Ningxia Tianyuan Manganese Industry Group, after almost a month's break, caused European manganese metal prices to decline in November. Based on the Metalshub price index, the weighted average price index for manganese metal flakes fell by 12%.

Noble and Chromium alloys

Lower demand in China has driven down the price of molybdenum products, which has had a corresponding impact on the European market. On Metalshub platform, FeMo prices fell moderately each week during November. As a result, the weighted average ferromolybdenum price index fell by 3% MoM.

A similar price trend was observed in the ferrovanadium market, with the only difference being that the decline in quotations was sharp and rapid in the first half of November, whereas by the end of the month the FeV price in Europe had even slightly increased. As a result, the weighted average FeV price index on Metalshub fell by 5%.

European chrome alloy prices continued to rise in November, most notably on the back of higher energy costs in the ferroalloy production process. The Metalshub price index recorded a 1% increase in the weighted average price for HC FeCr in November, while the low-carbon alloy gained 8% on average.

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Written by Alex Andreev alexandr.andreev@metals-hub.com

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