[Ferro-Alloys.com]China Ferroalloys Industry Association Membership Meeting was held in Beijing on April 14-15, 2015. In the chrome and silicon section, Mr. Liu, chairman of Ferro-Alloys.com, shared his opinions about the chrome market to all the attendees.

 

Mr. Liu said, "Excess capacity is a common problem for most industries in China, including ferrochrome industry. The capacity increase of ferrochrome must base on the stable end-users. Taigang Wanbang greatly increased its production capacity of high-carbon ferrochrome without hesitation, because it has the support of China's largest stainless steel maker and largest high-carbon ferrochrome purchaser-TISCO. Adding the cooperation with foreign miners, Taigang Wanbang decreased its production costs, allowing it to maintain a leading position in ferrochrome industry. So the ferrochrome plants have to be built in places like Shanxi province where there is short access to stainless steel makers and port." 

 

"China increased the penalties and fines for enterprises who consume more energy, pollute the environment seriously and major depend on resources after the implementation of the new environmental protection law. In order to survive under the new policy, ferroalloys enterprises have to refocus on the environmental protection. The ferroalloys export rebates would be eliminated after the producers succeed in meeting the new environmental protection low, following more profits." he stated.

 

"China is one of the world's largest chrome ore consumers and the largest chrome ore importer, due to a lower electricity price than South Africa and Turkey, as well as a lower labor cost, which makes a low production cost of ferrochrome. As a result, China's domestic prices of ferrochrome is lower than the other countries, despite higher price of chrome ores. But things would change, for China's production costs of ferrochrome is in an uptrend because of the rising labor cost." he added.

 

For the development of ferroalloys industry in the future, Mr. Liu possessed a optimistic attitude, despite of the current hardship. There would be a great demand for the "one belt, one road" program, including the construction of railways, highways, ports and infrastructures. And the current ferroalloys prices remain a production cost level or even below it, which indicates a price hike would come. 

 

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