India: Ferro silicon prices trend down on buyers' resistance to higher offers

• SAIL's reverse auction concludes
  
  
• ZCE futures prices drop
  
  

Indian ferro silicon (70%) prices fell by INR 1,900/t ($23/t) w-o-w compared to the previous assessment on 5 August 2024. Prices dropped as resistance continued in the market to higher offers.

Ferro silicon prices in India were INR 88,400/t ($1,053/t) exw-Guwahati, as per BigMint's assessment on 12 August. Bhutan's prices also fell by INR 1,200/t ($14/t) w-o-w to INR 89,800/t ($1,069/t) exw. Around 5,000 t of deals were reported to BigMint last week in both regions in a price range of INR 87,000-90,000/t ($1,036-1,072/t) exw.

Weekly market summary

Drop in offers post new price announcement: The majority of the sellers in both the regions were offering material at INR 91,000/t ($1,084/t) exw initially. Some are still offering at those levels but a major portion of them had to reduce offer prices to align with counter offers from buyers especially for bulk orders.

SAIL's auction result: Last week saw the conclusion of a 15,525 t ferro silicon reverse auction by SAIL for its seven units. It closed at INR 93,620/t FOR excluding taxes.

A producer from the North-east informed BigMint: "We are not offering anything as we have enough orders to dispatch as of now. We also have a target to not lower our offers below INR 90,000/t ($1,072/t) exw this month."

China market scenario: Ferro silicon (Si:75%) prices in China stayed steady with a slight w-o-w drop of RMB 80/t ($11/t) to RMB 6,880/t ($960/t) exw-Inner Mongolia. Reports indicated that producers were going for production cuts amidst limited inquires.

Additionally, ferro silicon futures for September delivery on China's Zhengzhou Commodity Exchange (ZCE) fell by RMB 420/t ($59/t) w-o-w to RMB 6,502/t ($907/t) on 12 August.

Outlook

Taking into account existing market conditions, BigMint estimates prices to witness a downward correction in the coming days.