China buys African, Turkish chrome on India tax rise

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Mar 27 : China, the world’s biggest producer of ferroalloys, is turning to South Africa and Turkey for chrome ore after India imposed a tax on the mineral to curb shipments. Chinese steelmakers and traders are increasing purchases of chrome ore from those countries after costs from India increased, said Tu Kun, ferroalloy general manager of China Minmetals Corp, the nation’s biggest importer of the commodity.

India, which has less than 1% of the world’s chromium deposits, supplies one third of China’s imports of chrome ores. The South Asian nation imposed a Rs 2,000 ($44) a tonne duty on overseas shipments of the commodity from March 1.

Higher duties raised costs for Chinese buyers as the nation’s economic growth of 10.7% last year boosted consumption.

“Chrome ore demand is strong because of increased production capacity of stainless steel in China,” Tu said at a conference in Hong Kong.

China may boost stainless steel output by 37% to 7.35 million metric tonne this year from 5.36 million tonne in 2006, metal research firm Heinz H Pariser said last week.