GLOBAL VANADIUM WRAP: Chinese, European Ferro-vanadium Prices Resume Downtrend On Thin Buying

Chinese and European ferro-vanadium prices resumed their downward trend last week amid a slowdown in spot activity and thin buying interest.

  • Chinese, European ferro-vanadium prices down on limited buying interest, thin trading
  • Vanadium pentoxide in Europe inches up due to tightening in available material
  • Ferro-vanadium market stabilizes in the United States

After a one-week pause, the ferro-vanadium export price in China resumed its downward trek on Thursday September 5, following the trend in both the domestic and the European markets.

Fastmarkets’ assessment of the export price for ferro-vanadium, 78% V min, fob China was $35.50-38.50 per kg on September 5, down by 1.3% $36-39 per kg from the previous week.

Buying interest for China-origin ferro-vanadium was said limited over the past week partly because Chinese material was more expensive.

“We failed to receive any inquiries from abroad and we are doubting whether there will be an increase in demand from Europe this year as expected because the summer has already come to an end and demand should have come back by now,” a Chinese ferro-vanadium exporter told Fastmarkets on September 5.

“The decline in the ferro-vanadium price in Europe also weakened market sentiment in China,” the ferro-vanadium exporter added.

The Chinese domestic ferro-vanadium market slipped further last week in response to a lower-than-expected trading price and muted buying interest after temporary signs of strengthening the previous week.

“Not many mills showed interest in purchasing ferro-vanadium this week,” a Chinese ferro-vanadium supplier said on September 5. “This is possibly because they have some stocks at plants and expect the upcoming production restrictions for the celebration of the 70th anniversary of the founding of the People’s Republic of China [to allow them to maintain normal production for a longer period of time with current stock levels].”

Many mills in northern China have already been required to carry out a round of production cuts that are aimed at improving air quality during the celebration period, which begins on September 1, market sources said.

Upstream, China’s export price for vanadium pentoxide (V2O5) was weighed down by weak sentiment stemming from a decline in the domestic price.

Fastmarkets assessed the export price of vanadium pentoxide, 98% V2O5 min, fob China, at $8.20-8.50 per lb on Thursday, down by 2.3% from $8.40-8.70 per lb the previous week.

The domestic V2O5 price slipped further amid weak buying interest from alloy plants, which have been cautious about restocking raw materials due to a lack of confidence in the near-term market outlook, market participants said.

Some V2O5 suppliers had to cut prices to encourage sales, fearing steeper reductions in the coming weeks, market participants added.

“We did not place orders [for V2O5] this [past] week because there is no clear sign that the alloy prices will rise in the future, so it’s risky and too early to buy some volume now,” a second Chinese ferro-vanadium supplier said. “It’s better to sit on the sidelines at the moment.”

European FeV market down; V2O5 activity increases
The European ferro-vanadium market fell last week due to limited spot market activity.

Fastmarkets’ assessment of the ferro-vanadium basis 78% V min, 1st grade, ddp Western Europe, price was at $30.15-31.10 per kg on September 6, down from the mid-week assessment of $30.60-31.10, when prices had retreated to that level from $30.80-32 per kg.

The “demand outlook is looking weak going forward with the automotive industry not doing great,” a trader in Europe said.

“There are few inquiries around but the tonnages are small,” a second trader in Europe said.

“Prices in China are weakening as well. It will be possible to buy below $30 [per kg] soon with Chinese material now arriving in Rotterdam,” the first trader said.

Meanwhile, Fastmarkets’ price assessment for vanadium pentoxide 98% V2O5 min, in-whs Rotterdam, increased to $7.50-8.50 per lb from $7.25-8.25 per lb the previous week due to increased spot activity and tightening availability, market sources said.

The “V2O5 market is tightening with no bids from the trade. $8.50 per lb was the lowest I could find,” a third trader said.

US FeV market stills, consumers absent
The US ferro-vanadium market was flat last week due to thin trading.

The US spot price for ferro-vanadium 70-80% V, in-whs Pittsburgh, was at $14.80-15.50 per lb on September 5, unchanged from the previous week, according to Fastmarkets’ latest assessment.

Mill buying activity remained subdued over the period, with the spot market limited to small-volume transactions.

“Outside of a few tonnes here and there for small buyers, there’s been absolutely nothing happening,” a supplier source said.

“It’s a somewhat alarmingly quiet [market] at this point. We thought we might see things pick up once September hit but that hasn’t been the case. Hopefully that turns around as the end of the quarter approaches but there aren’t many good signs out there,” a second supplier source said.

Market participants were expecting prices to hold in the current range while consumers remained out of the market.