- Bhutan’s offers rise by INR 7,000/t ($73/t) m-o-m
- Meghalaya plants closed due to pollution control violations
Indian ferro silicon (Si:70%) prices touched a 3-month peak with prices recovering to June 2026 levels at INR 94,700/t ($982/t) exw-Guwahati. In Bhutan as well, prices edged up by INR 300/t ($3/t) w-o-w to INR 94,000/t ($975/t) exw. Prices went up following Bhutan’s offer announcement of INR 94,000/t ($975/t) exw for this month along with reported plant closures in Meghalaya.
Close to around 900 t of deals were concluded last week in both regions within the price bracket of INR 94,000-95,000/t ($975-985/t) exw.
Market summary (29 September – 5 October)
Bhutan offers set higher benchmark: One key reason for the rise in ferro silicon prices was the increase in Bhutan’s monthly offers. For October, offers rose by INR 7,000/t ($73/t) m-o-m. Since Bhutan’s offers are widely followed as a benchmark by sellers in Bhutan and India’s northeastern region, the increase supported higher prices in these markets.
The rise was largely backed by expectations of a power tariff revision in Bhutan, with rates likely to increase to around INR 3.5/unit from the current INR 2.7/unit. As Bhutan typically imports electricity from India during the winter months to meet its power requirements, higher power costs could further increase production expenses and provide continued support to ferro silicon prices.
Tight supply keeps domestic prices elevated: As per latest reports, around five ferro silicon units in Meghalaya remain closed due to pollution control violations, affecting regional supply and limiting material availability in the spot market. This tighter supply situation has supported prices, with sellers maintaining higher offers. In Arunachal Pradesh, most sellers were also largely booked with earlier orders, leaving limited volumes available for fresh spot sales.
Additionally, sellers reported shortages of charcoal in the region, which further impacted production. The combination of production disruptions in Meghalaya, limited spot availability in Arunachal Pradesh, and raw material constraints has kept the regional ferro silicon market tight and supported prices at elevated levels.
Firm steel demand supports ferro silicon prices: Higher steel prices and improved steelmaking activity also provided a supportive backdrop for ferro silicon demand. Indian steel prices reached multi-year highs in September amid tighter supply, higher raw material costs and improving post-monsoon demand. This firm steel market is positive for ferro silicon consumption. With steel mills facing higher production costs and stronger price realisations, demand for ferro silicon remained relatively supported.
Outlook
Indian ferro silicon prices are likely to remain firm in the coming week, supported by higher Bhutan offers, tight regional availability and limited spot material. Expected increases in Bhutan’s power tariffs and ongoing production constraints in Meghalaya could keep seller offers elevated. Meanwhile, firm steel prices and healthy steelmaking activity are expected to provide continued demand support. However, any improvement in production and spot availability in the northeastern region could limit further price gains.
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