India: Ferro silicon prices fall as buyers resist high offers

Indian ferro silicon prices dropped w-o-w as buyers showed reluctance to book material at higher prices.

According to SteelMint's assessment on 27 Jan'22, Guwahati-based producers are offering for Si-70% grade at INR 156,100/tonnes(t)-exw, while Bhutan's offers are at INR 156,500/t-exw. However, some are offering even lower to meet their monthly targets.

Weekly highlights

• Indian ferro silicon producers received a large number of inquiries due to rising steel production, but most of these inquiries did not convert into deals due to high prices. This led to a decline in ferro silicon prices.
  
  
• Meanwhile, some buyers are anticipating further price reductions from Bhutan in early February. As a result, transactions were low in the last week of January.
  
  
• In the meantime, Indian ferro silicon smelters are making efforts to increase their prices due to increasing steel prices on the back of the hike in coal prices. But steelmakers are aware of the huge gap between production costs and selling prices of ferro silicon. This caused buyers to bargain hard and book the material at lower prices.
  
  
• A major seller explained, "If the price is regulated at INR 150,000/t levels, the foundries will begin to purchase ferro silicon again."
  
  
• Other major producers said, "Imported materials are coming into India. This has led to a drop in interest in the domestic material."
  
  

China's market review
Ferro silicon (FeSi75%) has risen slightly by RMB 100/t ($16/t) w-o-w to RMB 9,000/t ($1,415/t) exw-Inner Mongolia because of higher charcoal prices in China. The market performance was satisfactory. In the short term, ferro silicon prices are expected to remain stable.

Outlook
Indian buyers have adopted a wait-and-watch mode in anticipation of a further fall in prices in early-February.