Price trend

Since the new round of ferrosilicon bidding prices of HBIS was finalized and the market direction became clear, other steel mills have recently used this as a reference to conduct ferrosilicon bidding and procurement. The market inquiry and procurement atmosphere has been slightly active, and the inventory of enterprises has been consumed. At the same time, the news of raw material price increase has been reported again, and the cost side support has further increased. In addition, some silicon mills in some regions had few spot orders for production. In the case of more positive information, most of the recent enthusiasm for price reduction in the industry was not high, and some had a certain price support sentiment. However, the recent volatility and weakening of the futures market was difficult to form a favorable support for the spot market, and the supply of delivery warehouses was relatively sufficient. In addition, there were news of the resumption of production of some silicon mills. As of August 15, except for some steel mills conducting bidding and procurement, the demand situation on the retail side was relatively general. Most of them were in a wait-and-see mood. The actual transaction situation needed to be improved. All of these suppressed the ferrosilicon market. Buyers and sellers were slightly deadlocked, and some actual transaction prices loosened slightly. According to the commodity market analysis system of Sino-US, on August 15, the market quotation of ferrosilicon (brand: FeSi75~B; particle size grade/mm: natural block) in Ningxia was 5,450-5,500 RMB/ton, and the average market price was 5,504 RMB/ton, down 0.13% from Monday.

Influencing factors

Raw material semi-coke market: The national semi-coke market was stronger last week, companies shipped smoothly, and the overall market transaction was good. On the 15th, the downstream mainstream calcium carbide companies raised the purchase price of small and medium-sized materials by 10-35 RMB/ton, and the second round of semi-coke price increase began. As of August 15, the price of medium-sized raw materials in Shenmu market was 630-700 RMB/ton, the price of small raw materials was 630-650 RMB/ton, and the mainstream price of coke flour was 460-510 RMB/ton; the price of medium-sized raw materials in Fugu market was 630-680 RMB/ton, the price of small raw materials is 630-730 RMB/ton, and the mainstream price of coke flour was 460-580 RMB/ton; the mainstream price of coke flour in Zhongwei market was 530 RMB/ton; the price of mixed raw materials in Shizuishan market was 520 RMB/ton; the price of medium-sized and small raw materials in Ordos market was 620-670 RMB/ton, and the mainstream price of coke flour was 540 RMB/ton; the price of medium-sized and small raw materials in Hohhot market was 610-650 RMB/ton, and the mainstream price of coke flour was 550 RMB/ton; The price of small and medium-sized materials in Hami market was 580-700 RMB/ton, coke flour was 240 RMB/ton, and mixed materials were 220-280 RMB/ton; the price of small and medium-sized materials in Changji market was 600-700 RMB/ton, coke flour was 300 RMB/ton, and the above were all ex-factory prices in cash including tax; the price of small and medium-sized materials in Tianjin Port was 930-980 RMB/ton, and coke flour was 720-880 RMB/ton, and the above were all port closing prices in cash including tax; the price of small materials in Yumen market was 255-460 RMB/ton, coke flour price was 320-550 RMB/ton, carbon powder price was 440-450 RMB/ton, and rice material price was 350-380 RMB/ton, all were ex-factory prices in cash including tax.

Production Status

Ningxia and Qinghai were operating profitably, and manufacturers were actively resuming production. As of August 14, the national operating rate (capacity utilization) was 36.18%, a 1.86% increase from the previous week. Average daily output was 16,125 tons, a 3.43% increase, or 535 tons, from the previous week.

Downstream Situation

Last week, HBIS's August 75B ferrosilicon tender price was 6,030 RMB/ton, a 430 RMB/ton increase from the previous round. The asking price was 5,700 RMB/ton, compared to 5,600 RMB/ton in July. The August tender quantity for HBIS's 75B ferrosilicon was 2,835 tons, compared to 2,700 tons in the previous round, an increase of 135 tons. The latest ferrosilicon tender prices for a certain group were finalized: 5,890 RMB/ton for 200 tons in Hubei; 5,900 RMB/ton for 66 tons in Jiangsu; 6,080 RMB/ton for 400 tons in Yunfu, Guangdong; and 6,110 RMB/ton for 200 tons in Heyuan, Guangdong, for a total purchase of 866 tons. Other small and medium-sized steel mills were gradually following these pricing guidelines. Southern Steel's tender price was generally around 6,000 RMB/ton, including tax. In the export market, inquiries had not increased, and market demand was sluggish, with prices lacking short-term support.

Market outlook

Overall, the ferrosilicon futures market has cooled, and spot prices have begun to see a rational correction. However, as August is the peak period for steel mills' bidding and procurement, and the rebound in hot metal production supported the rigid demand for ferrosilicon, ferrosilicon price expectations should not be overly pessimistic. With increased purchasing demand from steel mills, the downward trend in spot ferrosilicon prices may slow down. Next week, ferrosilicon spot prices are expected to fluctuate narrowly and weaken.

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