Yuan appreciation, strong steel sector support UG2 market

The strengthening of the yuan and the positive momentum in the stainless steel sector supported the UG2 and domestic Chinese chrome ore market over week to September 8, Fastmarkets heard.

Fastmarkets’ chrome ore South Africa UG2 concentrates index basis 42%, cif China was $137 per tonne on Tuesday September 8, up by $3 per tonne or 2.2% from $134 per tonne a week earlier.
Market sources reported liquidity around the current price levels after some buyers were willing to accept higher prices in the seaborne market because of the appreciation of the yuan, which meant buyers could absorb higher dollar prices.
“Although prices increased by $2 or $3 [per tonne], buyers could absorb it without losing out in their own currency,” a seller said.
Some producers were optimistic that prices would continue to rise with support from the stainless steel market, Fastmarkets heard.
“Our shipments for October are nearly sold out. Demand is good and we're confident we'll be able to conclude above $140 per tonne,” a producer said.

Published

Jon Stibbs

Siyi Liu

September 09, 2020

14:52 GMT

London, Shanghai