Posted on 05 Feb 2026
China's production of high-carbon ferrochrome (HC FeCr) remained largely stable at a high level in January and reached 882,400 tonnes, down by a marginal 0.5% month-on-month but higher by a remarkable 38.9% year-on-year, according to the findings of Mysteel's latest survey covering 180 domestic smelters.
The dominant producing region of Inner Mongolia, which hosts most of China's FeCr capacity, continued to lift output of the ferroalloy last month. The survey results show production there rose 1.6% on month to 692,800 tonnes in January, which was also higher by 34.7% from January last year, as newer, more efficient smelters continued to ramp up operations.
In stark contrast, numerous smelters across southern provinces undertook planned maintenance stoppages or temporary shutdowns during the survey period. These significant supply reductions effectively offset the higher output from the newly commissioned capacity in Inner Mongolia, resulting in the slight overall decline nationwide.
Despite the stable output, the availability of spot cargoes tightened considerably in January, applying sustained upward pressure on prices, Mysteel Global notes. Mysteel's assessment showed that at end-January, the price of 55% high-carbon FeCr in Inner Mongolia, the key reference price in the domestic FeCr market, had surged to Yuan 8,550/t ($1,232/t), 50Cr, ex-works including VAT, up Yuan 450/t from a month earlier.
Industry sources attributed this to two factors, namely strong stockpiling demand from stainless steel mills ahead of the Chinese New Year holiday and tight spot supply. The latter had resulted from aggressive selling by some smelters during previous months, which had left their spot inventories low.
Looking ahead to February, market analysts anticipate a slight contraction in national HC FeCr output this month primarily due to fewer production days during the extended Chinese New Year holiday over February 15-23.
Besides, market participants note that most stainless steel mills have scheduled production cuts this month, with these planned reductions expected to temper near-term ferrochrome consumption and may subsequently cause output to contract.
However, this seasonal dip is expected to be cushioned by stable producer margins. Mysteel's latest assessments suggest that by February 3, the average profit margin among sampled smelters producing HC FeCr using the semi-closed submerged arc furnace-electric furnace route had risen to 6.6% in Inner Mongolia from the previous month's 6.1% average margin.
Major stainless mills have settled February procurement prices for HC FeCr under long-term contracts higher by some Yuan 50/t from January's levels, a factor that has helped improve the smelters' margins. On January 20, Tsingshan, the country's largest stainless steelmaker, nominated its February bid at Yuan 8,245/t (50% Cr basis), or $1,184/t, including tax and delivery, cash payment. The same day, TISCO, a major mill in North China, set its price at Yuan 8,045/t, on the same basis, according to market sources.
Source:Mysteel Global
