Chinese ferro silicon prices surge w-o-w on positive market momentum

The ferro silicon market in China improved on a positive momentum and various factors at play which include:

An uptick in prices w-o-w:

• Grade 75% silicon: Prices increased by RMB 250/t ($35/t) to settle within a range of RMB 6,960-7,140/t ($961-$985/t) ex-works, including tax.
  
  
• Grade 72% silicon: Prices followed a similar trend, rising by RMB 250/t ($35/t) to establish a new range of RMB 6,570-6,760/t ($907-$933/t) ex-works, including tax.
  
  

Increasing futures: The rising spot price alongside upward future movement, coupled with the increasing price of raw material blue carbon, reflected a complex interplay of factors pulling up the market.

Limited supplies, revamped demand: The low supply of ferro silicon and improving demand indicated a potential imbalance that favoured the sellers. Despite the rise in raw material costs, there was still an optimistic sentiment in the market, possibly indicating confidence in future demand or production capacity.

Reduction in electricity tariffs: The slight reduction in electricity prices might be providing some relief on the cost side, but it seemed like factories are holding onto their stock, possibly expecting further price increases.

Week ahead

The ferro silicon market experienced increased demand, leading to tight spot supply and companies prioritising production orders. Industry sentiment has improved, resulting in a stable market with limited low-priced offerings.

Despite high inventory levels in delivery warehouses post-steel mill bidding, there is a belief that the upward momentum may slightly wane, though the market is expected to remain robust in the short term.

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