India: Ferro silicon prices remain stable on modest demand

Ferro silicon prices continued to remain rangebound over the last few weeks amid moderate demand. Due to high cost of production, producers were not willing to reduce their prices.

According to SteelMint's assessment on 9 September, 2022, Guwahati and Bhutan's producers were offering 70% grade material at around INR 145,000- 150,000/t exw while for 65-70% grade offers were at around INR 143,000-145,000/t exw. Very few deals were recorded this week.

Market highlights
The majority of small-scale buyers booked limited quantity because of their apprehension about high prices. They reduced their weekly requirement by 30-40% in anticipation of a fall in the coming weeks. This kept demand moderate while prices remained firm with marginal fluctuation.

"Prices from most suppliers remained higher this week due to the high cost of electricity, and we prefer to consume limited stocks," a buyer source informed.

In addition, a few buyers who were not in a hurry to book material were more interested in Chinese material as import prices are comparatively cheaper than domestic offers. This also reduced demand for domestic material.

However, only a few producers were offering in the spot market, with the rest focusing on the upcoming tender of major steel mills in India. As a result of limited stocks, some producers tried to increase their offers, but buyer negotiations kept prices stable.

China market overview
The weekly price of Chinese ferro silicon (75%) in Inner Mongolia remained unchanged at RMB 8,000/t. However, a marginal correction of around RMB 200/t exw was observed for 75% grade in Shanxi on 8 September. This week, major suppliers in Ningxia and Inner Mongolia held firm prices based on semi-coke prices. Insiders predict that ferro silicon 75% min 200-500 mm mainstream prices would remain firm in the coming weeks due to relatively stable demand.

Furthermore, futures prices rose 6% on 9 September compared to 2 September for October deliveries. The futures price increased, causing most factories to halt quotations. Domestic ferro silicon prices are expected to remain stable in the near future.

Outlook
Market participants anticipate that the mainstream prices of ferro silicon 70% min will remain flat next week amid stable prices of raw materials.