Ferrosilicon prices continue to rise

Ferro-Silicon Price Update 

Ferro-silicon prices are on the rise again. Current market rates for 72# range from 6350 to 6500 yuan per ton, while 75# natural blocks sell between 6800 and 7000 yuan per ton, cash ex-factory. Standard blocks of 72# are now priced between 6500 and 6650 yuan per ton cash ex-factory. Notably, a leading factory in Shaanxi raised its price for 75# to 7000 yuan per ton, an increase of 200 yuan. Consequently, prices for 75# in other regions have also started to climb.

Manufacturing Adjustments

Manufacturers are now working predominantly on a pre-order basis. Previously stored stock is transitioning to delivery warehouses. This shift has helped restore ferro-silicon profits, encouraging some production area factories to restart operations. Despite these changes, the short-term supply situation remains tight, keeping factory prices firm.

Reasons for Price Increases

**Market Dynamics Post-Holiday:** After the Chinese New Year, the slow recovery of downstream demand led to a drop in silicon prices. Many factories faced losses, leading to increased shutdowns for maintenance and decreased output.

**Increased Trading Activity:** Recently, institutions and traders have been actively purchasing stocks, causing a rapid decline in factory inventories. This has pushed factories into a pre-order status, moving stocks from factory storage to delivery warehouses.

**Historical Price Trends:** Ferro-silicon prices have been declining for over a year, making traders reluctant to stock up. They have focused on back-to-back transactions or purchases based on immediate needs, keeping inventory levels low. However, with a recovery in the manufacturing sector in April and improved demand, prices have risen. This has motivated traders to re-enter the market, enhancing the level of market inquiries and transactions.

Despite a recent rise in the price of raw lanthanum carbon, the impact on ferro-silicon prices has been minimal due to the modest size of the increase.

Market Outlook

The short-term supply of ferro-silicon remains tight. Recent strong performance in the futures market has kept prices robust. With the May steel tender process already in progress, monitoring the extent of price increases during this round is crucial. As profitability improves, there is greater incentive for ferro-silicon factories to resume production, which should gradually increase daily output. It is expected that market prices for ferro-silicon will continue to be firm in the short term.


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