China: Ferro chrome output hits record high in March

• Ferro chrome surges on strong profitability
  
  
• Stainless steel demand lifts ferro chrome production
  
  

Mysteel Global: China's output of high-carbon ferro chrome (HC FeCr) surged to an all-time high in March, driven mainly by solid profitability at ferro chrome smelters and robust feedstock demand from the stainless steel sector, Mysteel Global learned.

Total domestic HC ferro chrome output reached 893,300 tonnes last month, up 4.9% from February and soaring 47.5% y-o-y, according to Mysteel's survey covering 180 domestic smelters. Output in Inner Mongolia, the country's primary production hub, totaled 719,200 tonnes, rising 5.1% m-o-m and 41.8% year-on-year.

In the first quarter of 2026, China's cumulative production of HC ferro chrome reached some 2.63 million tonnes, a sharp increase of 45.2% from January-March last year.

Profitability drives output growth

The decent profits on the ferro alloy being earned by Chinese ferro chrome smelters was the key contributor behind the surge, and particularly the on-year jump, Mysteel Global notes. In the first half of 2025, the ferro chrome smelters had incurred losses or poor margins, which led output to fall to a low of 605,500 tonnes in March last year. However, profit margins began to improve steadily from the second half, with the trend continuing into this year.

Ferro chrome prices remained firm entering the traditional peak months for demand during March-April, thanks to tight supply in the domestic spot markets. As of the end of last month, Mysteel's assessment showed that the price of 55% high-carbon ferro chrome in Inner Mongolia, the key reference price in the domestic ferro chrome market, had strengthened to RMB 8,675/t ($1270/t), 50 Cr, exw including VAT, making for a rise of RMB 125/t ($18/t), from a month earlier.

Meanwhile, leading Chinese stainless producers had kept their March procurement prices firm for HC ferro chrome under long-term contracts. Tsingshan, the country's largest stainless steelmaker, announced recently it was holding its bid for April delivery flat at RMB 8,245/t ($1270/t) (50% Cr basis), including tax and delivery, cash payment, according to market sources.

The healthy profit margins encouraged ferro chrome smelters to produce aggressively last month. Mysteel's latest assessments suggest that last month's daily average profit margin for producing high-carbon ferro chrome using the semi-closed submerged arc furnace-electric furnace route stood at 5.3% in Inner Mongolia, up significantly from 2.9% in the same month last year.

Stainless boom fuels demand

In parallel last month, the significant growth in China's stainless steel output had directly boosted ferro chrome demand. After the Chinese New Year (CNY) holiday in February, mills generally faced depleted stainless inventories and were keen to restock, further lifting procurement of Ferro chrome feedstock.

Total crude stainless output among the 43 Chinese mills under Mysteel's regular tracking stood at about 3.8 million tonnes in March, soaring by 1.09 million tonnes or 40.1% from February, and up 8.1% y-o-y.

Seasonal factors and outlook

The resumption of operations at ferro chrome smelters after the CNY holiday and fewer calendar days in February which created a low basis for comparison also contributed to March's monthly increase, Mysteel Global observes.

Looking ahead to April, with more ferro chrome smelters restarting operations and with stainless mills maintaining high production rates, demand for HC ferro chrome is expected to remain strong this month. As such, on a monthly basis "domestic ferro chrome output is likely to increase further at a moderate pace," a Mysteel analyst notes.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.