Chrome ore world resource status and its development trend
The world is rich in chrome ore resources, with proven reserves of about 7.5 billion tonnes and exploitable reserves of about 4.8 billion tonnes, mainly in South Africa (83.3%), Kazakhstan (8.9%), Zimbabwe (3.9%), etc. In 2002, the world’s ferrochrome production was about 4.5 million tonnes, of which South Africa’s production accounted for about 60%. South Africa has obvious advantages in developing ferrochrome industry: firstly, abundant resources and good quality of ore; secondly, abundant electricity resources and cheap electricity price (RMB 0.15/kW, h); thirdly, low labour cost; fourthly, advanced electric furnace equipment and large equipment capacity, generally 25-50MVA.
Analysis of the world ferrochrome market supply and demand, global ferrochrome production in 2001 oversupply, at that time, ferrochrome producers in order to stabilize product prices, the implementation of limited production, after the growth of global demand for stainless steel, ferrochrome production rose year by year. As global demand for stainless steel has adjusted, ferrochrome producers are also adjusting their ferrochrome production capacity.
This cyclical nature of the ferrochrome market has led to a prevalence of mergers and acquisitions in the chrome mining and ferrochrome manufacturing industries and has led to a concentration of production in a small number of interested countries and producers, who can also adjust their ferrochrome production capacity to the actual situation in the ferrochrome market and stabilise ferrochrome prices.
In 2002 there were 7 main ferrochrome production plants in the world, including 5 in South Africa; 1 in Kazakhstan; and 1 in Zimbabwe. The top 4 were: Xstrata 33% from Canco, Switzerland; Samancor 25% from BHPBilliton; Kazaldlstan (Alloy 2000) 17%; and Heroic 8% from Mitsubishi, Japan. In contrast, the combined production of South Africa and Kazakhstan was 3.7 million tonnes in 2003, growing from 42% of the world’s total ferrochrome production to 2/3 of the world’s total ferrochrome production. the joint venture organisation of Xstrata Alloys and SA Chrome became the world’s largest ferrochrome producer at the beginning of 2004. the Xstrata-SA Chrome joint venture, Samancor in South Africa and Kazkhrom in Kazakhstan are the leading producers of chrome alloys and ferrochrome, both of which account for more than 55% of the world’s total production. South Africa and Kazakhstan are also the countries with the greatest potential to increase production, and the report states that their ability to drive further concentration of chrome alloy and ferrochrome supply will continue to strengthen the dominant position of these two countries, as they both have their own abundant chrome ore resources without impacting ferrochrome alloy production. to 2.55 million tonnes/year. In Kazakhstan, Kazkhrom has increased its production of chrome particles to 400,000 tonnes/year during 2005. Although Finland, India and Brazil have their own ore resources, the production costs in these countries are hardly competitive with those in South Africa and Kazakhstan and will only be able to produce chrome ore and ferrochrome alloys to meet domestic needs.
Chrome ore domestic resource situation
As of 2002, there were 54 sources of ferrochrome ore in China, holding reserves of 2.519 million tonnes (ore), of which rich ore (Cr2O3>32%) accounted for only 49% of the country’s total reserves, and was mainly distributed in four provinces, namely Tibet, Inner Mongolia, Xinjiang and Gansu, which together accounted for 84.3% of the total reserves. At the same time, China’s ferrochrome deposits are small in scale, with no large ferrochrome deposits with reserves greater than 5 million tonnes having been discovered, and even medium-sized deposits with reserves of more than 1 million tonnes are only four, and the conditions for development and utilisation are poor, with inconvenient transportation, and most of them requiring pit mining. If the infrastructure in the western region is not improved, there will be great obstacles to the full exploitation of this part of the chromite resources; even if the development conditions are improved, according to the current annual production capacity of about 200,000 tons to calculate, without taking into account the mining loss rate and depletion rate, with the current reserves can only maintain mining for 20 years at most. Therefore, the current situation of the supply of ferrochrome ore resources in China and its prospect should be of great importance to us.
As China’s ferrochrome resources are mainly distributed in Xinjiang, Tibet and other places, the ore grade is low and the transportation is inconvenient. Analysis of the characteristics of China’s ferrochrome manufacturers: first, many manufacturers (Jilin, Liaoyang, Shenjia, Hengshan, Hutian, Sichuan Investment, Tibet), small scale; second, 95% of enterprises rely on imported ore, subject to resource constraints, high transport costs; third, high electricity prices.
Ferrochrome is the most important raw material for the production of stainless steel, this is due to the role of chromium in stainless steel plays a decisive role in determining the nature of stainless steel is only one element, which is chromium, each stainless steel must contain a certain amount of chromium. The corrosion resistance of stainless steel is mainly derived from chromium. Experimental evidence, only when the chromium content of more than 12% of the steel corrosion resistance will be greatly improved, therefore, the chromium content of stainless steel is generally not less than 12%. So the supply and demand of ferrochrome ore is closely related to the supply and demand of the stainless steel market.