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Ferrochrome-stainless linkage
What it is
Ferrochrome exists almost entirely to supply stainless steel, which needs chromium for corrosion resistance. Roughly the whole ferrochrome market is driven by stainless output, so alloy demand is a derivative of one customer industry
Indian ferrochrome consumption has grown 4-5% annually with stainless demand from automotive and construction
Impact on industries
- Stainless demand growth is structural, tied to construction, automotive, process industry and consumer durables rather than to any single cycle
- Single-end-market dependence is absolute - there is no alternative use to absorb ferrochrome if stainless output falls
- Chinese stainless production dominates global demand, so Indian ferrochrome prices are set by Chinese buying behaviour rather than domestic conditions
- The 200/400 series shift matters here - lower-chromium grades reduce ferrochrome intensity per tonne of stainless