Chinese ferro silicon prices reflect mixed sentiments, outlook dull

Prices of ferro silicon showed mixed trends this week as the market lacked clear guidance. Several factors affected the ferro silicon market:

Volatile prices:

• 75% silicon content: Prices decreased by RMB 50/t ($7/t) w-o-w, reaching RMB 6,820-7,000/t ($947-$973/t) ex-works, including tax.
  
  
• 72% silicon content: Prices inched up by RMB 50/t ($7/t) w-o-w, settling in the range of RMB 6,480-6,680/t ($900-$928/t) ex-works, including tax.
  
  

Weak spot-futures market: The spot price of ferro silicon dropped. Meanwhile, the futures price fell, creating a wait-and-see atmosphere in the market.

Market awaits Hegang Iron and Steel Co., Ltd prices : Ferro silicon is expected to enter the market through bidding this month, with a focus on the price set by Hegang Iron and Steel Co., Ltd. Despite this, the operating rate of ferro silicon production lines remains low.

Downstream market had mixed sentiments: Downstream steel bidding prices are on a downward trend, impacting Hegang's pricing situation. There were concerns that prices may fall below comprehensive costs, potentially leading to companies conducting maintenance after consuming raw material inventories.

Subdued market sentiments: It appears that the ferro silicon market remained uncertain and was undervalued, with manufacturers having limited inventories and shipments. The market is eagerly awaiting favourable policy stimulus, especially with major meetings taking place.

Outlook

In the short term, the ferro silicon market is anticipated to be dominated by fluctuations.

BigMint anticipates sluggish demand for ferro silicon in China in the near term. As many companies are planning to go under maintenance, this may lead to a supply deficit.

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