- Prices of ferro silicon stable w-o-w.
- Most dispatches of past two months cleared.
- International market bullish.
Indian ferro silicon prices have been increasing over the past few weeks amidst severe supply shortage. Most of the Bhutan producers have cleared a lot of backlog orders of the past two months and are now ready to book fresh orders. However, supply still remains an issue due to labour shortage.
Currently, prices are at INR 135,000/tonne (t) exw-Bhutan and INR 140,000/t ex-Guwahati. There are a lot of active inquiries from the export market, but due to decent prices in the domestic market and labour issues in Bhutan, producers are mostly interested in catering to the domestic market.
Imports from Bhutan increased by 45,820 t in May’21, due to the clearance of most of the backlog orders. Dispatches from the country suffered substantially in Apr’21 with only 185 t of ferro silicon dispatched, which hindered the supply chain cycle. The backlog dispatches of the past two months have been, however, collectively cleared this month.
Meanwhile, Guwahati producers are also booked and offering at higher prices compared to Bhutan. Due to delayed dispatches from the latter and irregular imports from countries other than Bhutan, most of the buyers who are in urgent need of the material are being forced to book at higher prices from the Guwahati producers.
Demand in the international market remains strong as the major Malaysian ferro silicon producer is out of the market due to increased Covid cases. Chinese production has also reduced due to power curtailment in the major producing areas. Although, prices in China remained stable w-o-w, market sentiments were bullish due to increased demand.
Outlook
Producers in Bhutan and India believe that ferro silicon prices may increase further due to higher demand and constricted supply. As many producers are tied up with bulk tenders, there is an increased chance of supply shortage in the market which will further drive up prices.
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