On the back of continued depressed demand, both spot and contract prices have fallen. As a result, ferrochrome producers are largely maintaining output cuts, in order that industry stocks continue to be drawn down from the extreme highs seen at the end of last year. The expectation that depressed market fundamentals may persist for some months yet has implications for prices, production, and trade flows. In Europe HC spot quotes edged down in April amid minimal trading activity. Indian-origin material slipped to 56-63 cents/lb DDP in April, Russian-sourced material fell to 60-65 cents/lb, and Kazakh-origin quotes dropped to 75-78 cents/lb. Thus our April average assessment for spot HC prices in Europe is 66 cents/lb, down 8 cents/lb, and a further fall is expected over the next month due to weak demand. One implication of low prices is that there is very little scope for Indian material in Europe given higher Indian production costs, while there may be an opportunity for lower-cost Kazakh material to gain market share.
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