SunSirs: The Futures Market was Fluctuating, and the Spot Price of Ferrosilicon was Fluctuating

Price trend

With the volatile operation of the futures market, the industry sentiment fluctuated in the past two days, and market quotes were fluctuating and relatively unstable. As for the situation on July 4th, on the one hand, news of a decrease in raw material prices had weakened cost support, and in some regions, news of silicon companies resuming production intensified the supply-demand imbalance. In addition, the deepening of the traditional off-season demand in the industry and the news of steel mills reducing production in some regions had "dragged down" the market for raw materials such as ferrosilicon, and the market demand situation needed to be improved; On the one hand, due to the release of steel bidding demand, with the concentrated bidding of major steel mills in the later stage, the demand had been released, boosting market sentiment. In addition, some silicon companies in certain regions were not under inventory pressure, and some low-priced goods in the industry were not highly motivated to temporarily adopt a wait-and-see attitude. According to the Commodity Market Analysis System of SunSirs, on July 4th, ferrosilicon (brand: FeSi75-B; The market price in Ningxia region for grain size grade/mm: natural block was between 5,100-5,250/ton, with an average market price of 5,152 RMB/ton, a decrease of 0.11% from Monday.

Influence factor

Raw material semi-coke market:

Last week, the overall semi-coke market in China was operating steadily. Except for a few enterprises that had adjusted their semi-coke prices slightly according to their own situation, the overall market price fluctuations were not significant, but the coke surface transactions were average, and there was still a slight decline in prices. As of July 4th, the mainstream prices for small and medium-sized materials in the Shenmu market were 570-670 RMB/ton, and 420-480 RMB/ton for coke flour; The price range for the Fugu market was 620-680 RMB/ton for medium materials, 590-700 RMB/ton for small materials, and 440-540 RMB/ton for coke flour; The mainstream price of coke in the Zhongwei market was 495 RMB/ton; Shizuishan Market Mix 500 RMB/ton; The price of small and medium-sized materials in the Ordos market was 500-640 RMB/ton, and the price of coke flour was 480-500 RMB/ton; The price of small and medium-sized materials in Hohhot market was 620 RMB/ton, and the price of coke flour was 540 RMB/ton; The price of small and medium-sized materials in the Hami market was 620-850 RMB/ton, the price of coke flour was 260 RMB/ton, and the price of mixed materials was 195-290 RMB/ton; The price of small and medium-sized materials in Changji market was 850 RMB/ton, and the price of coke flour was 350 RMB/ton, both of which were ex factory cash prices including tax; The price of small and medium-sized materials in Tianjin Port's semi-coke was 860-910 RMB/ton, and the price of coke flour was 880 RMB/ton, both of which are cash inclusive of taxes at the port closing price; The current prices for small materials were 280-500 RMB/ton, coke flour prices were 320-600 RMB/ton, mainstream coal powder prices were 470 RMB/ton, and rice materials prices were 350-370 RMB/ton, all of which were cash inclusive of tax at the factory price.

Construction progress

The supply was mainly maintaining a small increase, with no significant fluctuations as of July 4th. As of July 3rd, the national operating rate (capacity utilization rate) was 31.95%, an increase of 0.26% compared to the previous week; The daily average production was 14,320 tons, an increase of 2.72% compared to last week and an increase of 380 tons.

Downstream situation

Downstream bidding has gradually entered the market in July. On July 4th, a steel plant in Jiangsu Province bid for 400 tons of ferrosilicon at a price of 5,570 RMB/ton, with electronic vouchers. On July 3rd, a certain group's ferrosilicon bidding price was 5,470 RMB/ton in Hubei, with a quantity of 200 tons; Anhui 5,500 RMB/ton, quantity 300 tons; Guangdong Yunfu 5,620 RMB/ton, quantity 600 tons; Guangdong Heyuan 5,640 RMB/ton, quantity 250 tons; Total quantity of 1,350 tons; All cash, including tax, was delivered to the factory. 60% of the goods will arrive before July 13th, and all will arrive before July 18th. The futures company was experiencing a decline in the market, but the transactions had improved.

Market outlook

The background of economic downturn made it difficult to reflect the peak season of downstream demand, and downstream inventory was relatively tight. Downstream steel mills saw a clear upward drive in July's centralized bidding demand, and the price pressure of raw material costs was not significant. Traders still mainly relied on replenishing inventory according to demand. The inventory of ferrosilicon market may be more concentrated in the middle and downstream, and trade inventory was still mainly sold, but the overall inventory pressure on the manufacturer side was not obvious. The market has expectations for the replenishment of terminal stocks in the second half of the year, and as mentioned above, weak reality will bring stronger economic stimulus expectations, which are difficult to reverse. Therefore, although the fundamentals of ferrosilicon were weak, it is still difficult to see the driving force for a turnaround. It is expected that the price of ferrosilicon will fluctuate overall next week.

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