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The price applies to steelmakers in Europe and Asia. A feature of this round of negotiations was the narrowing of the gap between spot and contract quotes by removing the system of discounting, sources said.
"It was a natural consequence of the fact that the people involved had become disillusioned with the different games. In the fourth quarter, nobody had a clue what was going on," a seller said.
"The base price is 75 cents per lb, and all new business will start from that basis."
For years, buyers and sellers agreed prices for the mineral, a vital ingredient in stainless steel, in quarterly talks led by major South African chrome producers Xstrata and Samancor on one side, and European steelmakers ThyssenKrupp and Arcelor on the other.
They would arrive at a figure and informally publicise it as a price for the quarter, but sellers would often agree to reduce that price by varying degrees depending on the buyer.
The producer price in the fourth quarter of 2006 was settled at around 78c/lb before discounts - near the peak hit in 2005 - but the level of discounting left many in the market frustrated with the disparity between the stated figure and actual contract prices.
With so many discounts applied last quarter, the actual price was closer to 75c than 78c, while ferrochrome on the spot market traded around 70c/lb.
"Our target was to reduce the huge distance between reality and the official producer price," a buyer said.
"There's been a rollover in the net price. The nominal price has fallen, but the actual money changing hands is the same."
Analyst Heinz Pariser, president of Heinz H Pariser Alloy Metals & Steel Market Research, said the nominal reduction in price did not mean the market was weaker.
"I think it's a fair reflection of opinion as it was late last year, but the South Africans were too nervous," he said, echoing market talk that producers could have pushed for a higher price.
Instead, worries about extra metal coming to market played a prominent role in contract talks, he said.
"People were getting nervous at the end of last year. They saw the startup of International Ferro Metals, then they saw that (Xstrata's) Lion project was on the table, and that led them believing there could be a surplus in chrome," he said.
International Ferro Metals, the newest entrant to the ferrochrome industry, began production three months ahead of schedule, the firm said ealier this month.
"But when I look at demand, consumers are living hand-to-mouth and production of stainless steel remains strong," Pariser said.
