GLOBAL VANADIUM WRAP: Europe ferro-vanadium down on slow demand; US, China markets dip

Date: Mar 12, 2019

The European ferro-vanadium market fell in the week ended March 8 due to aggressive negotiations amid sluggish demand, while ferro-vanadium prices in China and the United States softened slightly.

  • Chinese ferro-vanadium market softens on lack of foreign buying interest
  • European ferro-vanadium prices slump on aggressive offers
  • European V2O5 edges down amid limited buying interest
  • US ferro-vanadium slips on inactivity

The Chinese ferro-vanadium export price declined, with some exporters lowering their offer prices amid persistently subdued buying appetite from abroad in the latest assessment period ended on Thursday March 7.

Fastmarkets’ export price for ferro-vanadium, min 78%, fob China, was assessed at $73-76 per kg on March 7, down 0.7% from $74-76 per kg the previous week.

Some Chinese ferro-vanadium exporters were reported to have reduced their offer prices to encourage sales and in anticipation of the price potentially coming under pressure due to the abundant supply in the domestic market.

“The demand [from abroad] has been very weak since the week-long Lunar New Year holiday [on February 4-10] while [ferro-vanadium] stocks have piled up since then,” a Chinese ferro-vanadium exporter told Fastmarkets on March 7.

Many domestic ferro-vanadium producers in China ramped up their production after the Lunar New Year, expecting the price to rise further following an anticipated restocking from both domestic steel mills and overseas buyers.

Buyers however, and especially those from overseas, have showed little interest in restocking from China, sources said.

Meanwhile, Chinese domestic mills have lost interest in procuring vanadium products recently, which aroused concerns over the increasing stocks pressure, while ferro-vanadium exporters cut their prices to promote sales amid rising stocks.

Many Chinese exporters, conversely, held their offer prices comparatively firm due to the belief that a rush cut in the vanadium price will only dampen market sentiment and send panic along the market.

“The more you cut your prices, the more unlikely it is people will come to you to place orders. They will only wait and expect you to lower your price a step more. Domestic prices have not slid down significantly, so we do not have a reason to give in so much right now,” a second Chinese ferro-vanadium exporter said.

Despite some signs of softening, many domestic market participants believe the ferro-vanadium price will not fall sharply. The relatively high and stable vanadium pentoxide (V2O5) price will provide some support to the downstream ferro-vanadium price, market participants told Fastmarkets.

“I don’t think there is lots of room for the [ferro-vanadium] price to drop. The V2O5 price is still quite high and I believe no one will be willing to buy expensive V205 while selling the ferro-vanadium at hand at a very low price,” a Chinese market source said, adding, “the price should fluctuate a bit in March, but not that much.”

Meanwhile, the Chinese V2O5 export price stagnated last week amid thin trading activity.

Fastmarkets’ export price assessment for V2O5, min 98%, fob China, stood at $16-17.20 per lb on March 7, unchanged for the third consecutive week.

Chinese V2O5 exporters were not interested in offering after noticing no real buying interest.

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