Chinese special alloys market continues to fall, mills wait for further decrease

Monday, 31 May 2010 16:38:10 (GMT+3)   |  
       

During the past week, the Chinese special alloy market has maintained its declining trend, with a rather weak transaction volume observed. Ferromolybdenum and ferrovanadium market prices have both been affected by the low purchase prices of the steel mills, and so overall domestic market prices have been trending downward. Based on the current market situation, weak demand and low transaction volumes will continue to influence China's domestic special alloy market.

Product name

Specification

Place of origin

Price (RMB/mt)

Weekly change (RMB/mt)

Price ($/mt)

Weekly change ($/mt)

Ferromolybdenum

Mo60

Jinzhou

143,000

-3,000

20,968

-440

Ferrovanadium

V50

Panzhihua

103,000

-3,000

15,103

-440

China's domestic ferromolybdenum market has continued its softening trend over the past week. The mainstream quotations in the market of Jinzhou are at RMB 140,000-145,000/mt ($20,528-21,261/mt), down RMB 3,000/mt ($440/mt) week on week, while market quotations for domestic origin ferromolybdenum concentrate (45 percent grade) are at RMB 2,150/mtu ($315/mtu), down RMB 50-100/mtu ($7-15/mtu) week on week. International prices have also trended downwards, with the current prices of bottled molybdenum oxide at $16.5-17.15/lb and with the European delivery prices of 60 percent Mo at $39.8-42/kg Mo.

Recently, ferromolybdenum purchases from domestic steel mills have been rare, and most mills have been steadily lowering their purchase prices. Purchase prices from mills in eastern China have dropped to RMB 140,000/mt ($20,528/mt). In the current market, most mills are waiting for further declines in the ferromolybdenum market. In addition, the current price of molybdenum concentrate has also continued to fall, and some miners possess high levels of inventory. Thus, quotations for molybdenum concentrate are likely to continue their downward movement in the coming period.

China's domestic ferrovanadium market has also maintained its downtrend in the past week. Quotations of domestic ferrovanadium (50 percent) are at RMB 100,000-105,000/mt ($14,663-15,396/mt), down RMB 3,000/mt ($440/mt) week on week, while vanadium pentoxide (98 percent flakes) stands at RMB 94,000-96,000/mt ($13,783-14,076/mt), down RMB 1,000-2,000/mt ($147-293/mt). Meanwhile, quotations of vanadium pentoxide in Europe are at $7.2-7.6/1b, with ferrovanadium (V70-80) at € 32.5-33.5/kg.

China's ferrovanadium market is still characterized by a strong wait-and-see attitude, with some steel mills concluding purchases at low price levels. In recent days, steel mills' tender prices for ferrovanadium (50 percent) have dropped to around RMB 100,000/mt ($14,663/mt), RMB 5,000/mt ($733/mt) lower than the domestic mainstream market price, thus causing the mainstream market price to move down further. Current quotations from traders are at RMB 105,000/mt ($15,396/mt). The domestic ferrovanadium market is expected to continue its weak trend due to slack demand from local mills and the fall in the export volume. In addition, domestic prices of vanadium pentoxide are down slightly, while transaction activity for vanadium pentoxide is rather quiet.


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