If you see a mouse under the inscription of an elephant, do not believe your eyes!

EU Benchmark vs CIF China South African FeCr price

The above graph represents one of the most puzzling aspects of the ferrochrome industry. The chart shows the gap between European Quarterly Benchmark and CIF China South African FeCr price. It is the same or similar material but the numbers represent the price indexes for two different markets. Needless to say that logistic cost difference is just a few cents and has nothing to do with the huge gap in numbers. While in the past the delta between the two markets was volatile, over the least two quarters it remains stable, on average a 50 cents difference.

Indeed, the existing pricing system does not reflect actual market reality. The same product might have a slightly different price, depending on geographical location and volumes, but such a difference illustrates how the existing system is misleading and that the global FeCr market requires something more reliable to measure actual supply and demand balance.

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And the pendulum continues to swing
Ferrochrome market diversity: crossroad or roundabout?