[Ferro-Alloys.com]：

  On December 10, 2020, hosted by China Ferro-Alloys.com and supported by Bao-metal Minerals International Trade Co, China chromium industry development and market online seminar was successfully held in Beijing. As the covid-19 pandemic outbreak globally in 2020, the chromium industry was influenced significantly. As the world's largest consumer of chromium resources, China is highly dependent on chromium ore. China and South Africa are the world's major exporters and consumers of chromium resources, so if either government take relevant measures then the world chromium industry will be affected. 80% of the world's chromite is used to produce ferrochrome and 90% of ferrochrome is used for stainless steel smelting. Generally, the trend of chromium industry is balanced but weak. Impacted by the development and demand of downstream stainless steel industry, the tendency of chromium products (ferrochrome, chrome ore) has shown a curved development with a relatively higher before and a relatively lower after. What problems may affect chromium market trend? We are honored to welcome honorable guests and experts participating in our meeting.

Honored Guests

  Mrs.Zhai Su Ping,Director of ORE ALLOY DEVELOPMENT CORPORATION LIMITED

  Mr.Karl Liu, General Manager of Sino-Minemet International Co.,Ltd.

  Mr.Wang Ke, Assistant General Manager of China Art(Far East ) Co.,Ltd.

  Mr.Zhang Junhong，Marketing Expert of Ferro Chrome ,Previous Sales Mr.Liang Zengyu, Chrome Expert

  Mr.Puma Cao，Chrome expert, ETI Krome Beijing Office

  Mr.Shi Lei, Pacific Linkage(China) Limited

  Mr.Vijay Singh, Ispat Group, India

  Mr.Okan, Bao-metal Minerals International Trade Co

  Mr. Liu Zhengzhi, General Manager of Sino-Minemet International Co.,Ltd., is the host.

  Mr. Liu Zhengzhi: Firstly, let us review the domestic Chrome Market in 2020, and look forward to the development of China's stainless steel industry in 2021.

  Mrs. Zhai Su Ping, Director of ORE ALLOY DEVELOPMENT CORPORATION LIMITED

  This year, domestic chrome ore and manufacturers hold high expectations for the domestic market. However, due to the coronavirus pandemic, the transportation, logistics and extraction of chrome ore at home and abroad are greatly affected. Domestic enterprises are more bullish on chrome ore market this year, but the output and price of chrome ore this year are the same as those in previous years. Throughout the year, there is no significant change but with a rising trend at the end of the year. There are two factors involved, the one is that the import procurement of steel enterprises has an impact on the domestic market and the other is that the bidding price of steel mills can also influence the market trend. Looking forward to 2021, South African export tariff tax will impact domestic market, but China can import more chrome ore from Kazakhstan, Turkey and India. Meanwhile, because of internal environmental measures and Inner Mongolian electricity restrictions, the mining capacity of South African mines will increase by 0.7-1 million tons (for example, the production of chromium ore in UG2 mine will increase next year). Therefore, on the whole, the industry development in 2021 will be similar to that in 2020.

  Mr. Wang Ke, Assistant General Manager of China Art(Far East ) Co., Ltd.

  In 2020, the domestic chrome market shows a downward trend. This is due to South African blockage at the end of March and export tax rate at the end of October. My perspective on the next year market: I predict that South Africa will impose export tariff on chrome ore from April to June in 2021, with the tax rate being 30%-40% and increased amount reaching 1 million tons. we should pay attention to South African tariff and market supply-and-demand relationship to wait and see when chrome ore market can reach the balance of supply and demand. For example, if the production cost rises and become higher than the market price, then the mine production will be reduced and the market supply-and-demand balance will be reached.

  Mr. Shi Lei, Pacific Linkage (China) Limited

  Apart from South African export tax rate and blockage, we also need to focus on the impact of domestic chrome ore port inventory. In 2020, with the rising price of chrome ore and inventory, the price of domestic port will be suppressed after the change of market expectations. As far as demand-and-supply is concerned, changes in the output of stainless steel and chromium ore have an impact on the demand for mineral consumption. The supply-side adjusts demand-and-supply according to actual situation, we should wait for South African official announcement to further discuss market changes.

  Mr.Puma Cao，Chrome expert, ETI Krome Beijing Office

  Due to global COVID-19 pandemic, in terms of South African export tax rate and domestic market, industry and transportation at home and abroad are affected in varying degrees. With the sluggish world economy, domestic chrome ore market has not shown a rising trend but remain stable. As for the market trend in 2021, we should focus on international pandemic and vaccine development. South African export tax rate is an important factor but not the major one. As the exchange rate changes, China's domestic market can offset the impact of this factor from June to August. In 2020, China's domestic market has not shown a positive trend. Take Tianjin as an example, more than 20-30 plants are faced with closure or restructuring this year, which has engendered a side effect on chrome ore market. This shows the situation is not better than 2008 financial crisis because at that time governments publicized large-scale economic policies. These three factors indicate that the chrome ore market will not fluctuate significantly next year and maintain a steady growth trend in the first half of the year. With Chinese government’s policy and the gradual internationalism of RMB, the RMB exchange rate will rise to 6.0-6.1 next year.

  Mr. Liu Zhengzhi: This year, China took the lead in controlling the epidemic situation and recovering its economy. In 2020, according to professional institutions, this year’s GDP is 2.5%. As the only country with a positive trend, domestic PMI growth rate accelerated and domestic situation improved. Next, let's talk about China's foreign exchange market. From April to present, the RMB has appreciated from 1:7 to 1:6.53. This is good news for importers, but it is not good for Chinese exporters. Let's invite experts working in international enterprises to talk about their views.

  Mr. Liang Zengyu, Chrome Expert

  The exchange rate of RMB is expected to rise within a reasonable range. This is determined by many factors. After the general election, US dollar is devalued, whereas recently it goes to appreciate.

  Mr. Liu Zhengzhi: At present, China takes domestic circulation as a major task, international dual-circulation as a subordinate to promote high-quality development. Even though RMB appreciate quickly, domestic export condition still plays a powerful role. Next, let us discuss the chromium export situation in Turkey and India.

  Mr.Okan, Bao-metal Minerals International Trade Co

  The high cost of chrome ore and ferrochrome in Turkey is mainly due to higher tariffs and production costs of local mines and government.

  Mr.Vijay Singh, Ispat Group, India

  India's chrome ore is not competitive in China's market. Due to coronavirus pandemic, international shipping costs are rising continuously. Recently, the prices of seafood, aquatic products and steaks from other countries have risen, and chrome ore in India will also be affected.

  Mr. Liu Zhengzhi: Recently, the rise of international sea freight has led to the rise of commodity prices. Affected by COVID-19 pandemic, the prices of international seaborne import and export are rising, especially the export shipping charges. Before the outbreak, China exported 1000 euro to Europe. Now it has skyrocketed to 3500 US dollars, and will rise to 4500 US dollars next month. Almost every week, the cost is rising. Likewise, before the outbreak, China's export to the United States was $2500, but now it has risen to $5000.

  Mr.Zhang Junhong, Marketing Expert of Ferro Chrome, Previous Sales

  The relation between stainless steel and chrome ore: Stainless steel production was reduced at the beginning of the year, but reached 33 million tons by the end of the year. The steel scrap in stainless steel production in China is 20% - 25%, while that in Europe and America is 80%. Therefore, the demand for ferrochrome in Europe and America is on the decline in recent years. Previously, Large quantities of South Africa's chrome ore was exported to Europe and the United States, but now it is turning to the Chinese market. 0.2 tons of 0.35 tons of ferrochrome exported to China and India last year. The relation between ferrochrome and stainless steel is closely related, without ferrochrome, there will not be stainless steel. In the past, in China, if stainless steel plants mismanaged and their profits went down, then they are more likely to reduce ferrochrome utilization. But now, the stainless steel factory will increase the price relatively in a rational way, from 700-800 before to 50-100 now.

  1. The output of stainless steel will increase to 33 million tons in 2020.

  2. The increase of stainless steel output will increase the demand for chromium, but steel scrap utilization will also increase.

  3. It is estimated that the output of stainless steel will increase in the first quarter of 2021, and the import volume will also increase. The output of Inner Mongolia’s chrome ore in the first quarter of next year will increase by more than 30000 tons compared with the fourth quarter of this year.

  In the first quarter of 2021, attention should be paid to the production capacity and profitability of stainless steel. Inner Mongolia's new industrial policy will release the capacity of new production. As the world's largest stainless steel producer and consumer of ferrochrome, China’s port inventory changes will also affect the consumption and utilization capacity of ferrochrome. The release of 10 million tons of ferrochrome production capacity in China is related to the profitability of enterprises.

  Currently, 1/3 of China's ferrochrome is imported, and the domestic port inventory is increasing. The inventory amount of Qingshan can last for more than three months. The capacity of domestic chromium enterprises is maintained at 60% - 70% , which means that enterprises have the ability of self-adjustment and self-repair.

  The electricity price in Ulanqab area of Inner Mongolia is expected to rise by 0.019-0.03, and the cost is expected to increase by 100 yuan per ton. Thanks to Inner Mongolia's superior geographical location (close to Shanxi and Tianjin port), even if the price of electricity rises, the output of ferrochrome will still increase.

  Mr. Liu Zhengzhi: Nowadays, the domestic ferrochrome market is mainly affected by five factors: South Africa's export tariff, domestic port inventory, new capacity, stainless steel production capacity and the change of exchange rate. The market plants should keep cautious and optimistic. Finally, I would like to invite guests to share different views on Survey on Hot issues of 2021 chromium industry development, and to express what you want to say in 2021.

  All of the above guests hope that the epidemic situation in 2021 will fade away early, the economy will recover and a healthy development of chromium industry. Finally, Mr. Liu Zhengzhi invite guests to participate in Annual Conference of Chinese Ferro-alloy Industry Chain & Market Trend Outlook of Manganese, Chrome and Nickel Ore and Ferro-alloy on 23 December, 2021 in Beijing.

  Thanks for all guests’coming and support!

• [Editor:Catherine Ren]