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The crisis in Europe effected the Nickel prices at London Metal Exchange. The stocks of ferro-chromes increasing everyday. Thus stainless steel producers are not able to increase their sales prices. So they started to put price pressure on ferro-chrome producers at their monthly tenders. As a chain of reaction, today this pressure is fully on chrome ore miners’ shoulders.
As per the market research of Turkey’s leading chrome ore supplier EKIN MADEN, there are huge stocks of South African chrome ores at Chinese ports and plants. It seems that today’s market situation will give more pressure on S.African producers. But who can say the same thing for Turkish chromes? There is a big shortage of high grade Turkish chromes, especially 48% basis concentrates both at the ports and plants.
Turkish chrome ore is one of the major product of this market. Especially 48% basis Turkish concentrates are irreplaceable. Even Turkish lumpy may be replaced by Albanian, Iran, Pakistan and Sudan origins or may be used less in bearish market days but Turkish concentrates can not. So EKIN MADEN raises a question to the market. Can we consider different origins of ores as the same or at different price index? There are lack of high grade Turkish materials at Chinese ports and plants, so is it possible to put pressure on Turkish chrome prices?
In March 2013, Turkish chrome exports to China reduced to 55.000 mts which is the lowest figure of last 4 years. And now in April exports almost stopped. What will be the result of this situation 2 months later? Big shortage of high grade concentrates and lumpies. Then what will happen? The prices of high grade chrome ores and concentrates will increase rapidly and again we will face a new price volatilation. But this does not mean that other origins will be effected the same. So today there is a wind of change at the chrome market. Each origin should be considered seperately and should not make the same market moves at the same time. If South African chrome price is dropping due to the high stocks, it does not mean that Turkish chrome will do the same.
Prices are almost at the breakeven levels comparing with the costs, therefore ongoing investments in Turkey now suspended and the miners which were closed during the winter time decided not to open their mines until these market levels changed for good. This will also cause lack of chrome ores in Turkish market as well.
EKIN MADEN as being the market leader of Turkish high grade concentrates, finally advised that they will continue supporting producers in Turkey and also end users in China by trying to find the best way to connect both parties for mutual benefits.
(Reported by EKIN MADEN)