Traditionally, Japanese buyers use the European benchmark as a point of reference for their long-term contract negotiations, but ultimately will settle at either a discount or premium to that level based on market conditions, Fastmarkets understands.
The price is negotiated by a leading South African ferro-chrome producer and a major European mill, and is then announced by the leading producer to the Johannesburg Stock Exchange.
South Africa and Kazakhstan are two major exporters of ferro-chrome that goes to Japan, Fastmarkets understands.
But, Japanese ferro-chrome buyers have been attempting to follow South Korea – the other major buyer in Northern Asia – which already based first-quarter contracts in 2019 on Chinese steel mills’ tender prices, according to market sources.
A South Korean buyer...