Trend Analysis

Domestic ferrosilicon market prices continued their upward trend. Throughout the week, the pace of price increases was distinct; aside from a brief correction on Monday, prices rallied for three consecutive days as market sentiment shifted from a "wait-and-see" stance to a bullish outlook, with upward momentum continuing to build. According to data from the SunSirs Commodity Market Analysis System, market prices for ferrosilicon (Grade: FeSi75-B; Particle Size: Natural Lumps) in

the Ningxia region rose by 0.84% on May 12 to 5,474.29 RMB/ton; increased by 0.23% on May 13 to 5,487.14 RMB/ton; and edged up by 0.10% on May 14 to 5,492.86 RMB/ton. On May 15, prices held steady at 5,492.86 RMB/ton, resulting in a cumulative weekly increase of approximately 1.18%. According to the weekly price fluctuation chart from SunSirs, over the past 12 weeks, nickel prices declined in six weeks and rose in six weeks; recently, nickel prices have experienced a slight decline.

Influencing Factors

Upstream Semi-coke Market: The upstream market for semi-coke—a key raw material—is generally exhibiting a trend of weak stability. The tax-inclusive price for medium-sized semi-coke from Shenmu remains within the range of 730–780 RMB/ton, while small-sized material sits between 690–730 RMB/ton. Overall prices remain steady; however, in certain regions, reduced operating rates among downstream calcium carbide manufacturers have dampened procurement demand, resulting in a market characterized by a "weak equilibrium between supply and demand."

Demand Situation: Steel tenders had concluded, and purchasing was primarily driven by immediate, essential needs

Hebei Iron & Steel Group (HBIS) has finalized its ferrosilicon tender price for May at 6,000 RMB/ton (tax-inclusive, delivered-to-plant, payable via acceptance bill). This represents an increase of 50 RMB/ton compared to the previous round. The procurement volume for the month stands at 2,916 tons—an increase of 483 tons over April—and this modest rise in the tender price has provided a certain boost to market sentiment. Tender prices at other major steel mills remained generally stable; while prices at some southern steel mills saw slight month-on-month fluctuations—for instance, a group in Hubei set its tender price at 5,890 RMB/ton, a decrease of 30 RMB/ton—procurement volumes remained steady, resulting in minimal overall price volatility across the steel sector's tenders. End-Market Demand: The downstream steel market has entered its traditional off-season, and the growth rate of hot metal production has slowed, limiting the incremental growth in rigid demand for ferrosilicon. However, restocking demand—driven by the low inventory levels held by steel mills in the preceding period—has served to underpin the overall ferrosilicon procurement volume. Market Sentiment: Following a bottoming-out of prices, traders and downstream purchasing enterprises have engaged in opportunistic restocking on dips, leading to a noticeable uptick in market trading activity compared to the previous period.

Inventory Status: Factory inventory saw a slight increase, but overall pressure remained moderate

Factory Inventory: Silicon-iron inventory among 60 sample enterprises stands at approximately 71,100 tons—a month-on-month increase of nearly 4,000 tons. Due to earlier price declines, some enterprises have shown limited willingness to ship their products, resulting in a slight accumulation of inventory. Warehouse Receipt Inventory: The combined total of futures warehouse receipts and valid pre-declarations amounts to 32,100 tons—a month-on-month decrease of over 8,000 tons—indicating that pressure from warehouse receipts remains low. Inventory Structure: Current silicon-iron inventory levels remain at a relatively low level compared to the same period in recent years. Furthermore, enterprises in the major production regions of Ningxia and Qinghai face minimal inventory pressure; there has been no occurrence of large-scale inventory accumulation, and consequently, inventory levels are exerting no significant downward pressure on prices.

Market Outlook

Based on a comprehensive analysis of last week's fundamental and technical signals for ferrosilicon, the short-term market is generally exhibiting a pattern of range-bound fluctuation with an upward bias. Regarding support factors, upstream semi-coke prices remain stable, limiting downside potential below the 5,400 RMB/ton mark. Mainstream steel mills have slightly raised their tender prices, and persistent restocking demand from downstream sectors provides a strong floor for spot prices. Furthermore, overall inventory levels remain relatively low, minimizing inventory accumulation pressure on producers and averting any immediate bearish risks associated with concentrated sell-offs. Regarding resistance factors, the downstream steel market has entered its traditional off-season; the growth rate of hot metal production has slowed, implying limited potential for incremental long-term demand within the industry. Traders remain cautious regarding future demand prospects during this off-season, showing weak willingness to chase rising prices, and market transactions are currently driven primarily by immediate, essential needs. Overall, short-term ferrosilicon prices are projected to consolidate within the 5,400–5,550 RMB/ton range. Should steel mills continue to raise their tender prices or if production cuts emerge in major production regions, prices could potentially break through the upper bound of this range; conversely, if downstream purchasing activity continues to weaken, the market may retest the 5,400 RMB/ton level, which serves as a key cost-based support threshold.

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