Price trend

Recently, the ferrosilicon futures market has continued to fluctuate within a range, with limited price volatility. The spot market has also remained relatively stable, with only minor price adjustments. According to data from the SunSirs commodity price analysis system, as of January 16th, the market price of ferrosilicon (grade: FeSi75~B; particle size/mm: natural lump) in the Ningxia region was 5,300-5,450 RMB/ton, with an average market price of 5,327 RMB/ton, a 0.16% increase compared to last Friday.

Influencing factors

Raw material semi-coke market:

Last week, the national semi-coke market remained stable, with no significant fluctuations in market prices, and companies maintained steady shipments. As of the 16th, the price of medium-sized semi-coke in the Shenmu market was 790-820 RMB/ton, small-sized semi-coke was 730-760 RMB/ton, and coke fines were 500-570 RMB/ton; in the Fugu market, medium-sized semi-coke was 790-850 RMB/ton, small-sized semi-coke was 750-870 RMB/ton, and coke fines were 510-600 RMB/ton; the mainstream price of coke fines in the Zhongwei market was 560 RMB/ton; and mixed semi-coke in the Shizuishan market was 530 RMB/ton. The fundamentals of the upstream and downstream markets of semi-coke remained relatively stable, and there was insufficient driving force for price increases or decreases in the semi-coke market. Short-term prices are expected to remain stable, but attention should be paid to the impact of recent snowfall on road transportation and freight costs, which may increase costs at the factory and port.

Supply and demand situation

In terms of supply, ferrosilicon profits have not recovered significantly, production enthusiasm was generally low, and market sentiment was stable. There was some pressure on inventory and shipments, and export volumes may continue to shrink in the near future. Overall production remains stable. As of January 15th, the national operating rate (capacity utilization) of ferrosilicon enterprises was 29.21%, a decrease of 0.42% compared to the previous week; the average daily output was 14,095 tons, a decrease of 0.42% compared to the previous week, or 60 tons less.

In terms of demand, due to the insignificant inventory pressure on steel mills and relatively good profitability, there is still some room for pig iron production to increase in the short term, and marginal supply pressure remains. Short-term demand is not expected to decline significantly, and is projected to remain relatively stable. Recent steel bidding prices in southern China were mostly around 5,900 RMB/ton; the recent volatility in futures prices was also reducing market participation among traders, leading to a slowdown in overall purchasing and a lack of willingness to stockpile. Some traders indicated that market uncertainty was high, and there is a greater probability of price declines.

Market Outlook

Overall, the ferrosilicon market is relatively stable in terms of price in the short term. Various small and medium-sized steel mills are setting prices for January, and demand remains somewhat supportive; however, expectations for purchasing from intermediaries have weakened, and the market is mainly focused on reducing inventory.

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