The following is an edited release by London-based metals market consultants Roskill. For more information, visit www.Roskill.com.
The current price for primary South African chrome ore of around US$170 per tonne (CIF China), places the price at around the 80 percentile of the chrome ore cost curve for supply sent to China.
Exporters of chrome ores experienced tightening margins in 2018, when the price declined to the 90 percentile based on an average annual price, although prices had already reached their present-day low level in August 2018, making the highest cost producers unprofitable for over 10 months.
A surge to over 21 million tonnes of chrome ore supply from South Africa, the largest chrome ore producing country with the largest resources and reserves, has kept the market in a significant surplus over 2018, which we at Roskill estimate to be on the order of 1 million tonnes of contained chromium — equivalent to approximately 3.5 million tonnes of metallurgical-grade chrome ores.
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