Chinese special alloys market posts slack trading performance

China's domestic special alloys market recorded an overall sluggishness in trading activity throughout the past week. Although ferromolybdenum prices have remained stable, players are still not optimistic as regards the prospects for the future trend of the market given the limited levels of demand. Meanwhile, the domestic ferrovanadium market has continued its sliding movement, with a recovery appearing unlikely in the short term.

Over the past week the Chinese ferromolybdenum market has maintained an overall stability, with quotations remaining at previous levels. By the end of last week, the mainstream prices of ferromolybdenum in Jingzhou were in the range of RMB 148,000-152,000/mt ($21,701-22,288/mt), while the market prices of molybdenum concentrate (45 percent) had declined RMB 50/mtu ($7/mtu) week on week to RMB 2,250-2,300/mtu ($330-337/mtu). Meanwhile, European market prices of ferromolybdenum (60 percent Mo) are at $32.5-33.5/kg Mo, while prices of molybdenum oxide in this market are at $13.2-14/lb.

China's domestic ferromolybdenum market saw a general stable movement in the past week, but was still characterized by flat levels of commercial activity. Since most ferromolybdenum producers have rejected high-priced molybdenum concentrate, molybdenum ore mines have had to lower their prices to boost sales, but only to see very few deals concluded. In addition, many ferromolybdenum producers recently stated that they would not sell materials below RMB 150,000/mt ($21,994/mt), while domestic mills made limited purchases during the past week at prices of RMB 145,000-150,000/mt ($21,261-21,994/mt). Looking at the current situation, most buyers have finished their stockpiling preparations for the upcoming National Day holiday (October 1-8), and only a few players are now seeking to make purchases before the holidays. As a result, China's domestic ferromolybdenum market is expected to retain its slackness in the short term.

Meanwhile, the Chinese ferrovanadium market has continued its soft trend over the past week. Domestic quotations of ferrovanadium (50 percent) have declined by RMB 2,000/mt ($293/mt) to the range of RMB 105,000-108,000/mt ($15,396-15,836/mt), with vanadium pentoxide (98 percent flakes) down RMB 3,000/mt ($440/mt) to RMB 95,000-98,000/mt ($13,930-14,370/mt). Meanwhile, in the international market, quotations of vanadium pentoxide (98 percent flakes) in Europe are at $7-7.6/lb, while market quotations of ferrovanadium (V70-80%) are down to €28.5-30.5/kg.

Still characterized by bearishness, the ferrovanadium market in China observed a minor slip in quotations in some regions in the past week. With mills' purchase prices generally around the level of RMB 104,000/mt ($15,249/mt), the trading volume has been quite low in recent days. Considering the declining trend of deal prices, some market players are predicting that ferrovanadium prices will fall to the range of RMB 95,000-100,000/mt ($13,930-14,663/mt). Meanwhile, given the sliding levels of ferrovanadium deal prices, ferrovanadium producers have been very reluctant to buy in vanadium pentoxide or have tried to reduce their purchase prices as much as possible. Although it seems hard for vanadium pentoxide sellers to accept such a low quotation level, the market prices of vanadium pentoxide have entered a downward phase. Overall, the Chinese ferrovanadium market is unlikely to see any recovery before the National Day holiday and will probably retain its weak performance in the coming period.