SunSirs: The Release of Demand Was Unclear, and the Spot Price of Ferrosilicon Was Fluctuating

Price trend

During the steel mill bidding window, the market was experiencing a strong wait-and-see attitude. Once the bidding prices of major steel mills are finalized, the direction of demand release may become clearer. Furthermore, given that some regional mills had low spot inventories, were primarily producing based on order schedules, and stable raw material prices were supporting costs, most holders were reluctant to reduce prices, with some still maintaining a price-supporting stance. With limited supply at low prices, a bottoming-out price support was emerging. According to the SunSirs Commodity Market Analysis System, on August 8, ferrosilicon (grade: FeSi75-B; particle size/mm: natural block) was quoted in the Ningxia region at 5,450-5,500 RMB/ton, with an average price of 5,490 RMB/ton, up 0.08% from Monday.

Influencing factors

Raw material semi-coke market:

Last week, the national semi-coke market maintained a stable operation, with smooth shipments and firm quotations. As of August 8, the price of medium-sized materials in Shenmu market was 620-690 RMB/ton, the price of small materials was 595-650 RMB/ton, and the mainstream price of coke flour was 460-510 RMB/ton; the price of medium-sized materials in Fugu market was 620-655 RMB/ton, the price of small materials was 590-730 RMB/ton, and the mainstream price of coke was 420-540 RMB/ton; the mainstream price of coke flour in Zhongwei market was 530 RMB/ton; the price of mixed materials in Shizuishan market was 520 RMB/ton; the price of medium and small materials in Ordos market was 610-650 RMB/ton, and the mainstream price of coke flour was 530 RMB/ton; the price of medium and small materials in Hohhot market was 560-600 RMB/ton, and the mainstream price of coke flour was 550 RMB/ton. The price of small and medium-sized materials in Hami market was 580-700 RMB/ton, coke flour was 240 RMB/ton, and mixed materials wee 205-280 RMB/ton; the price of small and medium-sized materials in Changji market was 850 RMB/ton, and coke flour was 350 RMB/ton. The above are all ex-factory prices in cash including tax; the price of small and medium-sized materials in Tianjin Port was 870-920 RMB/ton, and coke flour was 730-880 RMB/ton. The above were all port closing prices in cash including tax; the price of small materials in Yumen market was 255-460 RMB/ton, coke flour price was 320-550 RMB/ton, carbon powder price was 440-450 RMB/ton, and rice material price was 360 RMB/ton. All were ex-factory prices in cash including tax.

Operation Status

Ferrosilicon production companies were gradually recovering, with strong recovery expectations for August. Combined with the commissioning of new production capacity, overall supply saw a significant recovery in August. As of August 7, the national operating rate (capacity utilization) was 34.32%, a 0.56% increase from the previous week. Average daily output was 15,590 tons, a 4.45% increase, or 665 tons, from the previous week.

Downstream Situation

Demand for steel was temporarily declining seasonally during the off-season, but steel mill profits remained at their high levels, with limited room for overall production decline. Regarding rebar, steel mill profits remained relatively high, and short-term supply will continue to increase.

Market outlook

Overall, with the continued development of news about coking coal production restrictions and the growing expectation of production restrictions and shutdowns approaching mid-August, ferrous metal prices have become more volatile. Ferrosilicon shipments were temporarily strong, and downstream steel mills were generally operating at low inventories. Changes in steel mill profits warrant close attention. Ferrosilicon prices are likely to remain stable in the short term, with minimal potential for significant price adjustments.

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