Reuters reported that International Ferro Metals will slash output and delay investment in the business due to a slump in stainless steel demand that meant the company sold less than half of what it produced in recent months.

International Ferro Metals said in a statement that ferrochrome production in the three months to the end of September 2008 was 59,470 tonnes, 5% higher than in the previous quarter and up 41% on the year. But sales were just 28,025 tonnes, down from 89,091 tonnes in the previous quarter and 29,450 tonnes in 2007.

The discrepancy meant inventory levels surged to 33,265 tonnes as at the end of September from abnormally low levels of 1,934 tonnes at the end of June 2008. It also intends to reduce that stockpile to about 20,000 tonnes by the end of its financial year.

International Ferro Metals said that it would cut ferrochrome production by up to 40% to about 12,000 tonnes a month, reduce costs and postpone capital expenditure projects. It added that an ore beneficiation plant, palletizing and sintering projects, the construction of additional furnaces and the expansion of mining production will all be deferred. – Steel Guru