https://newsletter.mw.creamermedia.com

China, South Africa still driving chrome supply globally

ICDA senior market research analyst Tanya Atalay discusses current chrome market drivers

9th August 2024

By: Marleny Arnoldi

Deputy Editor Online

     

Font size: - +

In unpacking production and export figures for chrome and ferrochrome in 2023 and the first quarter of this year, the International Chromium Development Association (ICDA) has confirmed that China and South Africa continue to drive the chromium market.

ICDA senior market research analyst Tanya Atalay says these markets have shown resilience amid the global economic slowdown.

In China’s case, demand for chrome ore and high-carbon ferrochrome remains robust on the back of higher stainless steel output, which supports chrome ore prices.

In 2023, global chrome ore production experienced an increase, fuelled by heightened demand from Chinese smelters.

The production of chrome ore increased by 4% year-on-year in 2023, on the back of a 4.6% year-on-year growth in stainless steel production – which is a major demand source for chrome.

In the first quarter of this year, however, chrome ore production decreased compared with the fourth quarter of last year, owing to reduced consumption. The figures nonetheless demonstrate continued growth on a year-on-year basis.

Chrome prices are gaining momentum this year, but ferrochrome prices remain under pressure.

South African producers have resorted to using inventories of chrome amid higher- than-expected demand. The country remains the top exporter of chrome globally, while China remains the top importer.

South Africa accounted for about 17.8- million tonnes of the 21.8-million tonnes exported in 2023. For its part, China accounted for about 18.3-million tonnes of chrome imports out of a total 20-million tonnes imported globally in 2023.

In 2023, Africa accounted for 82% of the supply market share, while China held 92% of the import market share.

China has, in addition, started importing more chrome from Pakistan, Zimbabwe, Iran, Türkiye and Papua New Guinea.

All regions barring Asia recorded growth in chrome production in the first quarter of the year, with total output having grown by 4% year-on-year to 9.7-million tonnes in the quarter.

The 7% increase in South Africa’s chrome production in 2023 was, however, insufficient to cover the 27% growth experienced in exports globally – meaning there is a growing disparity between internal consumption, production and exports in South Africa.

Producers in Africa are preferring chrome ore production over ferrochrome production owing to high electricity costs and more favourable chrome ore market conditions.

While the high-carbon ferrochrome market is not significantly affected by the sanctions against Russia, the lower-carbon ferrochrome market structure is experiencing some changes.

Prices of ferrochrome remain under pressure as a result of weak global downstream markets and an oversupply of the alloy.

China continues to report growth in stainless steel production, while other main producing regions of stainless steel are experiencing lower growth.

The market expects 1.2-million tonnes of additional chrome supply this year owing to expansion projects by South African companies Jubilee Metals, Tharisa Minerals, Pelagic Resources, African Rainbow Minerals, Sibanye-Stillwater and Eastern Platinum.

South Africa may continue to struggle with the export of minerals owing to the country’s logistical constraints on rail and at ports. Producers have had to reroute shipments to the Maputo port, in Mozambique.

Ferrochrome has seen muted demand in the EU and the US, given inflation and geopolitical issues affecting consumer demand, while the Chinese market is currently oversupplied, with its own production having reached record levels in 2023.

Global output of ferrochrome also increased by 4% year-on-year to 16.2-million tonnes in 2023.

Meanwhile, the ICDA will be hosting its Chromium 2024 conference, in Cape Town, from November 5 to 7.

The event will host speakers and delegates as they discuss how South Africa can reach its full chrome export potential over the next decade, particularly by addressing key systemic challenges.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

Comments

Latest News

Showroom

SMS group
SMS group

At SMS group, we have made it our mission to create a carbon-neutral and sustainable metals industry.

VISIT SHOWROOM 
John Ratcliffe
John Ratcliffe

At John Ratcliffe, we are aftermarket specialists for heavy-duty on and off-road vehicles. We engineer and retrofit advanced safety systems, engine...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

MMC, Pan African, Vanadium Resources make headlines
MMC, Pan African, Vanadium Resources make headlines
4th October 2024
Magazine round up | 04 October 2024
Magazine round up | 04 October 2024
4th October 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.411 0.492s - 125pq - 2rq
Subscribe Now