Price trend

Ferrosilicon futures prices fluctuated downward last week, with low-priced supplies frequently appearing in the market amidst a period of easing prices. As of August 22, with August ferrosilicon tenders at major steel mills nearing completion, some buyers were scrambling to lower prices, leading to limited actual transactions. With the National Day holiday approaching and news of production restrictions at downstream steel mills spreading, ferrosilicon prices remained under pressure, with buyers and sellers continuing to negotiate. According to the SunSirs Commodity Market Analysis System, on August 22, ferrosilicon (grade: FeSi75-B; particle size/mm: natural lump) was quoted in the Ningxia region at 5,300-5,400 RMB/ton, with an average price of 5,311 RMB/ton, down 3.48% from Monday.

Influencing factors

Raw semi-coke market:

Last week, the national semi-coke market stabilized after rising prices. Companies mostly implemented the increased prices, and prices for small and medium-sized semi-coke remained firm. However, further price increases for coke flour were limited, and some companies experienced a slight slowdown in coke flour shipments. As of August 22, the price of medium-sized semi-coke in the Shenmu market was 630-710 RMB/ton, small semi-coke 630-690 RMB/ton, and the mainstream price of coke flour was 470-520 RMB/ton. In the Fugu market, medium-sized semi-coke was 640-680 RMB/ton, small semi-coke 630-760 RMB/ton, and coke flour was 460-580 RMB/ton. In the Zhongwei market, the mainstream price of coke flour was 530 RMB/ton. In the Shizuishan market, mixed semi-coke was 520 RMB/ton. In the Ordos market, the price of small and medium-sized semi-coke was 645-670 RMB/ton, and the price of coke flour was 560 RMB/ton. In the Hohhot market, the price of small and medium-sized semi-coke was 650-660 RMB/ton, and the price of coke flour was 580 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 195-280 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.

Operation Status

Last week, limited changes were seen in the main production areas. Ferrosilicon supply reached a high this year. Most manufacturers were still operating to meet orders, while some were temporarily without new orders and anticipate switching to other ferrosilicon varieties. As of August 21st, the national operating rate (capacity utilization) was 36.52%, a 0.34% increase from the previous week. Average daily output was 16,205 tons, an increase of 0.50%, or 80 tons, from the previous week.

Downstream Situation

Steel bidding prices had gradually weakened as the market weakened. On August 20th, a group's ferrosilicon bidding price in Hubei was 5,610 RMB/ton for a quantity of 600 tons; the total purchase price was 600 tons, all paid in cash including tax at the factory. A steel mill in Guangdong announced its latest round of ferrosilicon bidding at 5,950 RMB/ton, including tax, upon acceptance, for a purchase quantity of 200 tons. This represented a 200 RMB/ton increase from the previous round.

Market outlook

Overall, due to the intertwined bullish and bearish signals, the short-term ferrosilicon market may fluctuate within a range, and price adjustments cannot be ruled out. As for future trends, with the traditional peak demand season of "Golden September and Silver October" approaching, some industry insiders are somewhat optimistic about this. However, whether the ultimate trend will be as expected depends on closely monitoring the production of factories in various regions and the actual demand.

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