Glencore expects to produce 1.59 million tonnes of ferrochrome in 2017, up from a confirmed 1.52mt output in 2016. This figure is down -4% on the previous guidance on account of additional market-driven maintenance, the commodities trading and mining group says.

In the first half of 2017 Glencore’s production of ferrochrome grew 10% on-year to 836,000t, reflecting more furnace production time and strong furnace operational performance.

After a strong first quarter for global stainless steel output, China experienced a slowdown and destocking that led to reduced chrome products demand. This resulted in oversupply and steep price drops. US dollar prices fell to their lowest level in over a year.

“However, towards the end of H1 2017, a revival in Chinese stainless steel production, coupled with improved conditions in Europe, India, Japan and the US, contributed to a recovery in pricing for chrome ore and ferrochrome,” Glencore says in a report seen by Kallanish.

Including agency sales, the group shipped 3.4mt of ferroalloys in H1, down -6%. Ferroalloys revenue, however, rose 24% to $940 million.

Glencore’s production of ferromanganese and silicon manganese declined -1% and -41% respectively on-year in H1 to 72,000t and 26,000t. “The robust carbon steel market led to strong demand for manganese alloy during H1 2017, with low stock levels and reduced production keeping prices buoyant,” Glencore says.

Glencore’s iron ore sales rose 4% in H1 to 24.5mt. Prices saw significant volatility, reaching a high of $95/t before dropping to $55/t and then recovering to $70/t.

“Steel demand and margins were good, driving demand for higher quality iron ore; however, iron ore overall is oversupplied, with inventories increasing,” Glencore says. “As a result, we saw stress in discounts for lower quality iron ore, increasing from 5% at the lows to current levels around 30%. The iron ore market is trying to balance itself with a combination of decreasing price and increasing discounts and we expect a similar pattern over the next six months.”

On nickel, Glencore says that although Chinese destocking has ended and demand returned, Indonesia’s reversal of a ban on nickel ore exports has tilted risks towards increased supply.