ASIAN FERRO-ALLOYS CONF: Lower demand from rebar producers, ferro-niobium ramp-up set to hit Chinese vanadium consumption in 2019
Date: Mar 12, 2019
Shrinking demand from the downstream steel sector and the looming expansion of ferro-niobium capacity are likely to be headwinds to Chinese vanadium consumption, Morgan Wu, managing director of Chinese vanadium supplier Hangten Asia, said.
A reduction in infrastructure spending in China in 2019 is likely to cause the vanadium market to slow, Wu said during a panel discussion at Fastmarkets’ Asian Ferro-alloys Conference in Hong Kong on Monday March 10.
Wu noted a significant difference in policies aimed at improving the Chinese economy from the country’s National People’s Congress (NPC) on March 5-15 compared with previous years.
“The latest policies are about cutting tax and saving costs. There is almost no [significant] infrastructure encouragement this year,” Wu told delegates.
According to unconfirmed reports from the NPC, Beijing is mulling a property tax, which is likely to weaken sentiment in the real estate market. This negativity could dampen buying interest in rebar.
Ferro-vanadium is primarily used to produce rebar, one of the most important materials for infrastructure and house building.
The ferro-vanadium price in China is the main driver of the domestic rebar price, Wu pointed out.
Chinese ferro-vanadium prices fell sharply between mid-November and late December, partially due to a slide in the Chinese rebar price at that time.
Fastmarkets assessed the price of Chinese ferro-vanadium, 78% min fob China at $68.5-70 per kg on December 27, down 48.7% from an all-time high at $130-140 per kg that was prevailed between mid-October and mid-November last year.
