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SunSirs: April domestic ferrosilicon spot market analysis

May 06 2020 13:33:36     SunSirs (Molly)

1. Price Trend

According to SunSirs price monitoring, the current mainstream offer price of ferrosilicon 75 # in the domestic trade market is around 6100 yuan / ton, and the price of ferrosilicon 72 # is 5350-5600 yuan / ton, a slight increase from last week's ferrosilicon quotation.

2. Analysis of influencing factors

On the one hand, factories have successively disseminated information on production stoppages and production cuts. In addition, as the major steel mills have launched a new round of ferrosilicon tenders, the overall inquiry and procurement atmosphere has been significantly active. Therefore, the recent willingness of factories to increase prices has increased.

On the one hand, although the new round of bidding prices for iconic iron and steel companies has not been finalized so far, the situation is not optimistic (the overall trend is a slight decline) due to the introduction of tenders. The ferrosilicon market is basically stable and there is no obvious fluctuation in the whole. But the news came from the market yesterday. From 0:00 on May 6, the toll roads in the country will resume tolls. As soon as this news comes out, the number of inquiries from the market today has increased significantly (in the case of a significant increase in costs, most of them intend to Completed the purchase, therefore, some factories mainly ordered and shipped goods), and some enterprise quotations were also slightly increased for this reason (the range was about 50 yuan / ton).

In the steel market, there is a demand for stocking of downstream projects before the May 1 holiday, but the total amount is not large, and it is basically purchased on demand. At present, the profits of steel mills are relatively stable, the production enthusiasm is still strong, and high inventories have a normalized trend to suppress the rebound of steel prices. Most steel mills and merchants mainly rely on active shipments, and there is downward pressure on prices. It is expected that the short-term steel prices will run weakly.

In the futures market, today's main ferrosilicon futures contract contracted back in 2009. It is reported that the Ministry of Transport, with the approval of the State Council, resumed the impact of toll road charges across the country. Then it opened sharply higher in the morning, and oscillated all the way to the 5860 line, then the selling increased, quickly down to the 5800 line, and oscillated to the close, the highest intraday 5864 points, the lowest 5754 points, the transaction volume increased significantly from the previous trading day Open interest increased slightly from the previous trading day. Technically, the Ferrosilicon 09 contract is running above the MA5 moving average today, and the MACD effective red column is slightly enlarged. Affected by the news, today's center of gravity has moved up significantly, the operating range has moved up to a certain extent, the spot market quotation has increased to a certain extent, the operating range may have moved up to 5650-5900, operation recommendations, small position range operation.

3. Future market forecast

In the short term, the ferrosilicon market should continue to operate smoothly, and in the case of a significant increase in transportation costs and overall demand due to the impact of steel moves, it is not ruled out that prices may rise again.

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