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Kallanish Kallanish

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December, 12th 2019

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JUN 14
01:00

Oman Chromite Q1 shipments surge 48% after slow China demand hits 2014 sales

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Oman Chromite saw increased demand spur a 48% on-year surge in shipments in the first quarter, while restructuring brought down losses in its associate by 58%. Sales in Q1 were directed for export, resulting in increased shipping and transportation costs, the firm says in a report seen by Kallanish.

Revenue in Q1 rose 35% on-year to OMR 605,502 ($1.6 million), while net profit grew 3% to OMR 191,560. The loss from associate Al Batna Quarries Co. fell to OMR 14,822. The firm did not specify a Q1 sales tonnage.

In full-year 2014 Oman Chromite registered a 7.4% drop in deliveries to 24,893 tonnes, of which 54% was sold domestically. The steel industry accounted for 62% of sales, with the balance sold to the refractory industry.

The decline in sales was due to less demand from China, the firm’s main export market. The East Asian nation also favoured increased imports of ferrochrome over chrome ore. Steelmaking raw material prices fell by 11.2% on-year in Q4 2014, thus necessitating an expansion in local chromite sales, the company says.

The company is conducting a study to “…achieve better production methods and enhance marketing capabilities through added-value”, it says.

Oman is the world’s third-largest chromite exporter to China after South Africa and Turkey. Production in 2012 – the latest statistics available – dropped to 555,000t from a peak of 865,000t in 2010, according to the US Geological Survey. Government plans to ban metal ore exports in order to encourage ferroalloy production investments have not yet materialised.

However, Oman has seen four new ferrochrome producers spring up in recent years in Sohar’s “metals and mining cluster”, with a combined capacity of 485,000 t/year once all are completed.