India: Ferro silicon prices surge amid limited supplies, higher offers

• Meghalaya plants may reopen in around 10 days
  
  
• Ferro silicon futures on ZCE drop by RMB 160/t ($23/t)
  
  

Indian ferro silicon (70%) prices continued their uptrend last week, rising by INR 9,000/tonnes ($107/t) w-o-w compared to the previous assessment on 30 September. This increase was driven by the ongoing closure of plants in Meghalaya, leading to higher offers from remaining sellers.

According to BigMint's assessment on 7 October, ferro silicon prices in India reached INR 106,000/t ($1,263/t) exw-Guwahati. Meanwhile, prices in Bhutan surged by INR 10,800/t ($129/t) w-o-w, reaching INR 106,500/t ($1,269/t) exw. Around 1,600 tonnes of deals were concluded last week across both regions, with prices ranging between INR 100,000-108,000/t ($1,191-1,286/t) exw.

Plant suspensions, its implications-insights from BigMint's webinar

Around four ferro silicon plants in Byrnihat region of Meghalaya have been closed for more than one month now creating supplying constraint. As discussed in BigMint's webinar on Tuesday, the esteemed panelists - Aditya Agrawal, Director, Shyam Century Ferrous Ltd, Meghalaya and Navin Kumar Dadoo, Group Advisor, Pelden Group, Bhutan shared their insights on the current market trends.

The panelists added that the combined capacity of the closed plants stands at around 6,000 t a month and they are hopeful that the production could start in next 8-10 days. Supply chain will then take another 10-15 days to return to the normal level. Another factor for the price increase was the rising production costs along with the recent hike in steel prices. They also stressed on power supply issues faced by the plants in Meghalaya.

Also it was indicated that the demand from stainless steel mills have become more need-based and they are usually buying on weekly basis rather than procuring on monthly basis. Regarding imports, Malaysia and Brazil can be looked upon for material depending on cost curve.

Drop in ZCE futures prices

China's market has just reopened after a week-long holiday, so the full implications are yet to be seen. However, ferro silicon futures for January 2025 delivery on the Zhengzhou Commodity Exchange (ZCE) dropped by RMB 160/t ($23/t) w-o-w, settling at RMB 6,634/t ($940/t) on 8 October.

Outlook

Given the current market conditions, prices may continue to rise in the coming days. The extent of this increase will largely depend on both demand and buyers' acceptance levels.