Ferro silicon prices in India increased by INR 1,000/t w-o-w despite weak demand as Indian producers attempted to raise prices due to the expiration of BIS certificate registration on 23 October, 2022.
As per SteelMint’s assessment on 28 October, Guwahati producers were offering at around INR 131,400/t exw. However, some Indian smelters were offering a bit higher, but deals have not been concluded due to weak demand. Meanwhile, Bhutan producers with BIS certificate registration were offering at around INR 133,500/t ex-factory.
In order to clear the backlog of orders, Bhutanese producers could not accept orders for immediate dispatch. Furthermore, this week, the disruption was intensified by a delay in extending BIS certification. It is expected that the extension will be announced by the Ministry of Steel in the near future.
On the other hand, Guwahati producers were not benefiting much from the expiration of the BIS certificate due to weak demand, and the majority of buyers were on wait-and-watch mode due to ample stocks. Moreover, since most buyers only purchased hand-to-mouth, demand naturally slowed down.
Outlook
The ferro silicon market remains in a state of disequilibrium as a result of the increasing supply disruption from Bhutan due to the BIS issue. Hence, most market participants expect prices to fall amid high inventory in the coming week. However, if a supply crunch emerges due to delay in extension, it could support prices, SteelMint notes.
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