Chinese V2O5 Shipments Reduced but Ferro-vanadium Exports increased in 2018

Date: Feb 14, 2019 to data, China’s exports of vanadium pentoxide (V2O5) declined by approximately 19% year on year to 6,894 tonnes in 2018. Before November 2018, the V2O5 price had risen more quickly in China’s domestic market than in foreign markets. Chinese V2O5 producers therefore preferred to sell their products domestically, market participants said. And the price for vanadium pentoxide also jumped by 171% from early 2018 to an all-time high of $31-33 per lb Fob China on October 25, 2018, before sinking by 53.1% to $14-16 per lb Fob China at the end of 2018. The latest price was $15.50-16.50 per kg on February 12.

On the other hand, it is learnt that Chinese ferro-vanadium exports (basis 75% vanadium) totaled 6,142 tonnes in 2018, growing by 31.1% from that of last year. The significant increase is partly the result of Chinese participants’ growing interest in the export market due to the higher prices there relative to China. The European ferro-vanadium, basis 78%, free delivered duty paid, climbed to a multi-year high of $126-128 per kg on November 16, 2018, up by 165% from $46.50-49.50 per kg on January 3 – the first assessment of 2018. The price was most recently assessed at $77-79 per kg on February 8.

Though China’s domestic ferro-vanadium price recorded a significant increase over the same period on the expectation that the enforcement of new rebar tensile standards in country would boost demand for the ferro-alloy, Chinese mills showed their resistance to the surging prices and have increasingly turned to more cost-effective alternatives such as ferro-niobium amid shrinking profit margins. But after stagnating toward the end of November 2018 in quiet conditions due to market participants’ watch-and-wait attitude, the Chinese ferro-vanadium price began to slide after many realized that the country’s new rebar policy was not being enforced as stringently as previously expected.

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