- Price pressures ease as consumption improves
- ZCE futures inch down by RMB 200/t w-o-w
CBC: The Chinese ferro silicon market was relatively, particularly after the Spring Festival. In contrast to the typical market fluctuations seen during this period, price adjustments were limited, suggesting a stabilising effect following the holiday.
Grade 72% silicon: Prices stood firm at RMB 5,980-6,170/tonne (t) ($821-847/t) ex-factory, inclusive of taxes.
Grade 75% silicon: Prices were at RMB 6,260-6,450/t ($859-913/t), unchanged w-o-w.
Market updates
Production resumption boosts supply: As factories resumed operations after the holiday, the supply of ferro silicon gradually returned to normal levels. However, production did not increase significantly enough to cause a supply glut, which would have pressured prices given that demand has yet to experience a sharp spike (though it has risen).
Supply-demand balance improves: While supply increased, demand strengthened too, leading to a narrowing supply-demand margin. Inventories with producers declined, signalling a healthier balance between production and consumption.
Price pressures ease: Consequently, price reductions, which were once a concern, softened this week, and price pressures on manufacturers plateaued. The possibility of further price drops appears unlikely in the short term.
ZCE futures inch down: On 20 February, prices on the Zhengzhou Commodity Exchange (ZCE) for May 2025 delivery edged down by RMB 200/t ($2/t) w-o-w to RMB 6,238 ($856/t) from RMB 6,438/t ($884/t).
Outlook
In the short term, the Chinese ferro silicon market is expected to remain stable with limited price fluctuations.
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