Last week, the domestic spot market for ferrosilicon saw a slight rise following a period of minor fluctuation and consolidation. Data from the SunSirs commodity market analysis system indicates that the market price for ferrosilicon (Grade: FeSi75-B; Particle size: natural lumps) in the Ningxia region stood at 5,510 RMB/ton on August 3, having dipped slightly that day to a periodic low. Prices subsequently trended upward, reaching 5,524.29 RMB/ton on August 4 and climbing further to 5,545.71 RMB/ton on August 5. After a brief, minor pullback to 5,542.86 RMB/ton on August 6—marking a short pause in the trend—prices rallied again to 5,564.29 RMB/ton on August 7. Over the week, the price rose by a total of 54.29 RMB/ton, an increase of approximately 0.99%.

I. Influencing Factors

Upstream semi-coke situation:

Prices remained stable with an upward bias during this period. Safety inspections at coal mines in the northern Shaanxi production hub continued, while operating rates at semi-coke plants held steady at moderate levels; with the supply of feedstock coal tightening, semi-coke producers showed a strong inclination to maintain price levels. Ex-factory prices for medium-sized semi-coke saw slight increases, and the comprehensive production cost for ferrosilicon smelting rose in tandem; as smelting margins—already at low levels—continued to be squeezed, ferrosilicon manufacturers showed little willingness to sell at low prices.

Demand situation: Essential procurement remained stable, and market expectations continued to improve.

Steel mills utilizing the long-process production route are replenishing ferrosilicon stocks on an as-needed basis; current raw material inventories remain at low-to-moderate levels, creating a need for periodic restocking. Market attention is currently focused on the pricing of steel mills' ferrosilicon tenders for late August, with expectations leaning toward stable prices or slight increases. Previously, the market operated at low levels with low procurement prices; however, bullish capital positioned itself early, driving spot prices upward. As no large-scale tenders have materialized yet, the market trend is primarily driven by expectations, and the sustainability of price trends will depend on the actual tender prices.

Inventory Status: Low inventory levels at steel mills; market circulation inventory was depleting slowly.

Most major steel mills are maintaining low-to-moderate ferrosilicon inventories while awaiting the outcome of the next round of steel mill tenders, having temporarily paused large-scale stockpiling. Ferrosilicon producers have steadily reduced their inventories, easing the pressure of unshipped stock; combined with cost support, this has led to a decline in low-priced sell-offs. Meanwhile, inventory growth in the spot market remains limited; as prices stabilize and rebound, holders are increasingly reluctant to sell, further tightening the supply of available stock—a trend that favors the market outlook.

Market Outlook

Supportive Factors

Upstream semi-coke costs continue to provide a price floor, and ferrosilicon producers show strong resistance to price drops; expectations for a new round of steel mill tenders are heating up, leading the market to anticipate—and position for—higher tender prices, while buying sentiment remains positive; inventory pressure across the supply chain is low and available market supply is tightening, limiting the scope for any significant price correction.

Risk suppression

Current market trends are driven by expectations regarding steel mill tenders; should the pricing of these tenders fall short of market expectations, there is a risk that prices could spike and then retreat. Meanwhile, the recovery of downstream end-user demand remains sluggish, and there has been no large-scale release of substantive, essential demand.

Range Forecast

In the short term, ferrosilicon prices are likely to maintain a pattern of fluctuation with an upward bias. Key resistance lies in the 5,580–5,600 RMB/ton range, while support is found at 5,530–5,510 RMB/ton. Absent any major positive developments regarding steel mill tenders, the market is likely to enter a consolidation phase after an initial rally; however, if the increase in tender prices meets expectations, prices may test the upper resistance levels.

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