- Lower semi-coke and hydropower costs weaken market sentiment
- Weak offtake and cautious buying pressure prices
Ferro silicon (Si:75%) prices in China edged down by RMB 50/t ($7/t) w-o-w to RMB 6,040-6,190/t ($890-912/t) exw, inclusive of taxes. Meanwhile, Si:72% prices also inched down by RMB 50/t ($7/t) to RMB 5,500-5,600/t ($832-849/t) exw.
Chinese ferro silicon prices fell this week as lower production costs and increased supply outweighed weak downstream demand. Bearish sentiment and inventory pressure prompted producers to offer discounts, dragging spot prices lower.
Market updates
Diminishing cost support pressures prices: The cost structure softened as production resumptions in north-western regions, supported by lower hydropower tariffs during the wet season, lifted operating rates and market availability. Meanwhile, easing semi-coke prices reduced production costs, encouraging stable output and keeping inventories elevated.
Muted demand limits market upside: Steel mills maintained need-based procurement amid the seasonal off-season, while magnesium producers restricted purchases to essential volumes. Export demand remained sluggish, with limited buying interest from overseas markets. The lack of meaningful downstream restocking kept transaction volumes subdued, forcing producers to lower offers and extending the decline in spot prices.
Outlook
Domestic ferro silicon prices are expected to remain weak as ample supply and subdued demand weigh on fundamentals. Unless supported by higher input costs or aggressive steel mill restocking, spot prices are likely to consolidate at lower levels.
With inputs from CBC
Leave a Reply