Abstract
The impact of the downturn on the global economy, starting in mid 2008, had a
marked impact on the chromium market, as both prices and demand plummeted. In
March 2009, European importers paid around US?86/lb for South African
ferro-chrome, some 60% lower than prices (US?213/lb) paid in September 2008.
Demand for chromium over this period has fallen sharply, as demand for
stainless steel, the primary end-use for chromium, has collapsed. However, the
predicted negative outlook for the chromium market in 2009 is likely to be
short lived.
What the report gives you
- Independent, in-depth research and analysis
- Essential market intelligence for successful business planning
- Detailed survey of production and processing in 44 countries
- Up-to-date profiles of the activities of over 150 producing and processing
companies
- Forecasts for end-use consumption and world supply and demand
Report highlights
Around 94% of global chromite production is destined for use in the
metallurgical industry, for the production of ferro-chrome, with the remainder
produced for use in the foundry, chemical and refractory sectors. World mine
production of chromite therefore follows the pattern of world ferro-chrome
production. Around 70% of global chromite production is consumed domestically
in ferro-chrome production in the country of origin.
Three countries dominate output of ferro-chrome. In 2008, South Africa,
Kazakhstan and India accounted for around 67% of total world production,
declining slightly from 70% in 2002. However, while the largest ferro-chrome
producers continue to dominate the market, Chinese production has started to
increase rapidly. At around 1.5Mt in 2008, Chinese ferro-chrome production has
grown at an annual average rate of 28% per year, for the period 2002 to 2008.
The stainless steel industry is by far the largest consumer of ferro-chrome.
Until the beginning of the downturn in the global economy, stainless steel
production had shown large increases. Demand in developing countries such as
China and India helped global output increase at an annual average rate of
5.4% for the period 2000 to 2007, with China alone accounting for over 60% of
this rise in global stainless production
Given that South Africa is the leading supplier of ferro-chrome, any changes
to supply have a large impact on the price. In early 2008, South African
production of ferro-chrome was restricted, as producers struggled with a lack
of electricity. Structural problems in the country' s power generation saw
producers operate on a limited basis, which in turn limited the supply of
ferro-chrome on the international market. As stainless producers throughout
the world panic-bought ferro-chrome, demand exceeded supply, pushing prices to
as high as USc213/lb at its peak, over 130% higher than the average price in
2007.
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