Ferro Silicon offers are witnessing a sharp rise globally on rising demand and production cut announced by some Chinese producers.
Limited supply of Ferro Silicon has pushed its price significantly upwards, in line with low inventory of the commodity with steel mills in countries that rely on importing Ferro Silicon. China is very low on inventory as their governing body has been cutting power as pollution control policy and as it is a high power intensive industry, production of Ferro Silicon is significantly down, and so are exports from the said country.
Moreover, Russia is also low on production during the winter season and logistical issues also remain a major factor in the region. Moreover, Malaysia is also finding it difficult to cope with its domestic and overseas demand, with most of their production booked in long-term contracts.
SteelMint assessed export price of Ferro Silicon at USD 1,580/MT FOB Kolkata, while producers are trying to lift the prices further.
Demand for Ferro Silicon in domestic market also remains high on strong steel fundamentals. Indian producers were observed to be optimistic about rising Ferro Silicon offers and said that their offers don’t hold good the next day, when the market is faced with such upward momentum.
“We have already concluded deals at INR 90,000/MT (Ex-Guwahati) and are now offering at INR 95,000/MT,” said a Guwahati based producer expressing his contentment. He also revealed that India has not been importing from Malaysia.
The Bhutanese producers revealed that they have been quoting at INR 95,000/MT (Ex-Bhutan) while being confident that finding deals would not be tough in such a market scenario.
On the future outlook, the sell-side participants are confident that Ferro Silicon prices will move up sharply as buyers are scrambling for material amid a severe global supply crunch.
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