Merafe Resources CEO Steve Phiri believes that the ferrochrome price has bottomed at the European benchmark price of US69c/lb. Phiri made this forecast after the second-quarter (Q2) level had fallen US10c/lb below the US79c/lb Q1 price.
Phiri said that the Xstrata-Merafe Chrome Venture’s stock levels were continuing to decline, owing to the company producing far less ferrochrome than it was selling. Globally, ferrochrome-using stainless steel was also being produced at a volume higher than the ferrochrome output.
While the Xstrata-Merafe Chrome Venture might even go beyond its 80% cutback to avoid the high winter electricity tariffs, it remained determined to retain its 6000 permanent employees. Investment banker Fairfax is also forecasting a recovery in the price of metals by end of this year.
Source: Mining Weekly
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