India: Ferro silicon prices fall amid limited domestic demand

Indian ferro silicon prices, after reaching record highs in Nov’21, have been on a declining trend from Dec’21 owing to muted demand from consumers.

SteelMint assessed current market prices for HC 70% grade at around INR 141,800/tonnes (t) exw-Guwahati, while Bhutan’s offers are on the higher side at around 143,000/t exw.

Ferro silicon producers are offering higher prices too for different grades, sizes, payment terms, and packing. Domestic steel mills are resisting book material due to the higher prices. Most of the consumers are speculating that prices may move down further on slow buying interest, further intensifying selling pressure. Meanwhile, some producers who are booked for the month are still offering higher than the above-stated levels.

Weekly market overview

India

• Buyers were less interested at last week’s prevailing prices of around INR 145,000/t. So, sellers reduced their offers to boost buying interest.
• In addition, buyers were bargaining hard this week and SteelMint recorded 2,300t of trade from the domestic market. This resulted in a marginal fall in ferro silicon prices. A small deal was also heard at around INR 139,000/t FOR basis too.
• However, improved steel and coke prices made smelters decrease ferro silicon prices further.

China

• This week, ferro silicon (Si-75%) prices increased as manufacturers in Qinghai, Inner Mongolia, and some other provinces increased their offers by RMB 50-100/t ($8-16/t) to RMB 9,050-9,550/t ($1,430-1,510/t) exw. A few deals and inquiries were seen following the Chinese New Year. But the ferro silicon market has not changed much.
• Meanwhile, ferro silicon stocks this year are short, unlike previous years when they were abundant after the Chinese New Year. Since ferro silicon producers increased their operating rates, the overall supply and demand situation is relatively balanced. Since the ferro silicon futures prices and the steel mill tenders did not show a clear indicator, the market adopted a wait-and-watch mode.

Europe
European ferro silicon price dropped marginally as some buyers concluded some deals at levels lower than those prevailing. However, a supply shortage due to production cuts in Europe from key producers due to high electricity costs and a shortage of replacement imports, as well as expected renewed domestic demand in the second quarter, might hike pricing in the near term.

Outlook
Indian ferro silicon prices are expected to remain relatively stable mainly due to increasing costs of raw materials and the unavailability of coke. However, tepid demand may deter sentiments.