Price trends

During this period (August 24-28), the ferrosilicon market exhibited a volatile trend characterized by an initial surge, a subsequent pullback, and a later recovery. Data from the SunSirs commodity market analysis system indicates that the market price for ferrosilicon (Grade: FeSi75-B; Size: natural lumps) in the Ningxia region was 5,628 RMB/ton on August 24. Prices spiked rapidly on August 25, driven upward by sentiment in both the futures and spot markets. After a pullback on August 27, the market center of gravity shifted upward again; by August 28, the quoted price stood at 5,647 RMB/ton, marking a period gain of 0.33%. Overall, spot price volatility increased, and trader sentiment shifted rapidly in response to futures market movements, with most market participants adopting a strategy of aligning their actions with prevailing market conditions.

Fundamental analysis

Upstream semi-coke market: The market is generally stable, with only moderate cost-side support. Operating rates at semi-coke plants remain normal, ensuring relatively ample supply; on the procurement side, ferrosilicon plants are purchasing based on immediate needs rather than engaging in large-scale restocking. Semi-coke prices have seen no significant fluctuations, and with limited volatility in ferrosilicon production costs, there is no strong upward pressure driven by upstream costs; instead, price movements largely track the fluctuations of the ferrosilicon spot market.

Demand Situation: Downstream steel mills are maintaining steady, essential procurement—focusing primarily on replenishing stocks based on immediate needs—with little inclination to proactively build up large inventories. Operating rates in other downstream sectors, such as casting and magnesium production, are recovering slowly, limiting the release of actual end-user consumption. The recent surge in ferrosilicon prices has been driven largely by market sentiment regarding spot trading rather than a significant rebound in downstream demand; the demand side currently lacks strong bullish support, and there is limited willingness among downstream buyers to chase higher prices.

Inventory Status: Social inventories of ferrosilicon remain at neutral levels, showing no significant accumulation or depletion. Manufacturers face little inventory pressure, with some withholding sales during price spikes; meanwhile, traders in the distribution sector hold generally low inventory levels, maintaining a cautious stance on stockpiling and largely adhering to a "quick-turnover" operational model. Inventory levels are not acting as a primary directional driver; instead, market trends are predominantly shaped by sentiment and expectations regarding steel mill tenders.

Steel Mill Tender Status: The market is currently in a window of negotiation for a new round of ferrosilicon tenders by steel mills, with large-scale tender results yet to materialize. Expectations of a slight price increase in this round have prompted tentative upward adjustments in spot market quotes. However, market divergence persists, and downstream steel mills remain inclined to drive prices down; the final settlement prices from these tenders will serve as a key indicator for future spot market trends, and the actual outcome of the tenders will directly influence the subsequent price trajectory of ferrosilicon.

Market outlook

Overall, the current market for ferrosilicon is characterized by sentiment-driven volatility; upstream cost support is limited, downstream demand shows no significant improvement, and inventory levels remain neutral. The market is primarily awaiting the outcome of steel mill tenders, and the sustainability of the price trend will depend on the results of these tenders and the strength of actual downstream purchasing follow-through.

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