China: Ferro silicon prices hold steady amid weak demand, limited production

• Coal, power tags soften, fail to offer cost support
  
  
• Market wary, limited upward pressure expected
  
  

CBC: Chinese ferro silicon prices were largely stable w-o-w, influenced by weak demand and low production.

Grade 72% silicon: Prices were unchanged w-o-w at RMB 5,980-6,170/tonne (t) ($819-845/t) ex-factory, inclusive of taxes.

Grade 75% silicon: Prices remained mostly steady w-o-w, with a slight decline of RMB 50/t ($7/t) to RMB 6,260-6,450/t ($858-884/t).

Market updates

Limited demand keeps market dull: The ferro silicon market remained stable, with prices hovering at low levels due to weak coal prices, low power costs, and limited demand from steel mills. The lack of significant growth in steel mill demand contributed to a subdued market, while on the supply side, a seasonal decline in ferro silicon production further dampened market activity.

Additionally, there was little support from the cost side, as factors such as electricity charges and semi-coke prices were not strong enough to drive up ferro silicon tags. With no substantial shifts in supply-demand dynamics and external cost pressures, market fundamentals remained weak. As a result, there is limited optimism for a significant uptrend in prices in the short term.

ZCE futures inch down w-o-w: On 26 December, prices on the Zhengzhou Commodity Exchange (ZCE) for February 2025 delivery inched down by RMB 42/t ($6/t) to RMB 6,220/t ($852/t) from RMB 6,262/t ($858/t) on 19 December.

Outlook

The ferro silicon market is expected to remain stable with moderate fluctuations in the short term, driven by weak demand from steel mills, low semi-coke prices, and the approaching Spring Festival. Market sentiment remains cautious, with limited upward pressure expected.