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Chinese ferro silicon prices drop as buyers refuse higher offers

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Ferro Silicon

BigMint Bureau

128 Reads

4 Jul 2024, 17:50 IST

Chinese ferro silicon prices drop as buyers refuse higher offers

Prices of ferro silicon in China declined as buyers refused to accept prices which had risen w-o-w by as much as RMB 250/tonne ($34/t).

Prices of various grades were as below:

Grade 75% silicon: Prices remained largely stable with a slight decline of RMB 50/t ($1/t) w-o-w to settle within a range of RMB 7,100-7,200/t ($977-$990/t) ex-works, including tax.

Grade 72% silicon: Prices followed a downward graph, declining by RMB 250/t ($34/t) w-o-w to RMB 6,600-6,700/t ($908-$922/t) ex-works, including tax.

Factors influencing price

Rigidity in acceptance of higher offers: Several factors have influenced the pricing of ferro silicon this week. Producers were compelled to adjust their market quotations downwards due to the unacceptance of higher quotes. However, rising costs of inputs such as semi-coke and electricity, has squeezed their profit margins.

Declining downstream demand: With news of factory output resumptions in certain areas, there has been a slight uptick in overall production. Despite this development, overall market activity still faced challenges. Downstream industries, particularly those in real estate and building materials, showed sluggish demand and were less receptive to higher prices. Traders, observing these market conditions, remain cautious and preferred to stay on the sidelines.

Ferro silicon futures inch up: China's Zhengzhou Commodity Exchange (ZCE) for September 2024 delivery of ferro silicon inched up by RMB 134/t ($18/t) to RMB 7,018/t ($965/t) on 4 July, 2024 as against RMB 6,884/t ($947/t) on 27 June 2024.

Outlook

Factors such as subdued downstream demand and economic challenges in related sectors suggest that ferro silicon prices may face constraints in achieving significant long-term growth.

Market participants are advised to monitor these dynamics closely to navigate potential fluctuations in the ferro silicon market effectively.

Note: This article has been written in accordance with an agreement between CBC and BigMint.