Tharisa, the PGM and chrome co-producer, hasentered into a five-year strategic co-operation agreement with Taiyuan Iron & Steel (Group) Co Ltd (TISCO’s) joint venture (JV) company Shanxi Taigang Wanbang Furnace Charge Co Ltd. Tharisa will be supplying the JV with a minimum of 240,000 t/y at market prices starting in September 2017.  This represents approximately 25% of Tharisa’s forecast FY2017 production of 1 Mt of metallurgical grade chrome concentrate.

More stringent environmental regulations in China have meant the ferrochrome industry has started switching from open and semi-closed furnaces to more efficient and environmentally friendly technologies such as those that use sintering and pelletising. TISCO produces approximately 4 Mt of stainless steel a year and through its JV has installed 700,000 t/y Outokumpu ferrochrome (FeCr) sintering and pelletising capacity, with an annual producing volume of 300,000 t FeCr. The stainless steel producer is considering a phase 2 expansion of the Outokumpu FeCr sintering and pelletising plant, which would increase its FeCr production to 450,000 t/y and subsequently increase its requirements for metallurgical chrome concentrate.

Increased stainless steel production has been the driver of improved ferrochrome prices with spot currently being above US$200/t. Commenting on the TISCO agreement, Phoevos Pouroulis, CEO of Tharisa stated: “Tharisa is pleased to have formalised its relationship with TISCO, a long-time client.  The co-operation agreement further cements our position in the Chinese market and bolsters our order book.”