Weekly: Ferrosilicon price is returning to rational
In the first week of 2018, domestic ferrosilicon price is returning to rationality
On January 1st, the ferrosilicon manufacturers in Zhongwei region resumed production. In January, the tender for steel mills was drawing to a close, and the ferrosilicon traders watched the market cautiously.
As of now, most ferrosilicon manufacturers offer 72% ferrosilicon at around 1165 USD/MT, quotations from large ferrosilicon manufacturers have also been revised down, and the overall market spread has narrowed.
The ferrosilicon manufacturers in Zhongwei city, Ningxia province has resumed production
Because of the early work of prevention and control of atmospheric pollution, Zhongwei city, Ningxia province has achieved some success. December 31, 2017, Zhongwei City Government departments issued a notice that ferroalloys and other industries to resume production program.
And the resumption of electricity supply to local ferroalloy manufacturers at 12 p.m. on the same day. A total of 18 sets ore furnace to resume production. It will add 60,000 tons of monthly ferrosilicon capacity a week later.
Tender situation in steel mills
The representative steel mills have now determined the price of the ferrosilicon bidding in January:
- The purchase price of 72% ferrosilicon for HBIS Group Co., Ltd on January is 1535 USD/MT, purchases amount is 5850 tons.
- The purchase price of 72% ferrosilicon for Jiangsu Shagang Group Co., Ltd on January is 1215 USD/MT, purchases amount is 3800 tons.
At present, steel mills have entered the period of raw material reserves in winter, but their willingness to purchase in the market is not strong.
From the successive purchases of steel mills in January, the majority of mills still rely on the one-month purchases and the demand has not been concentrated.
Overall market
Since this week, from the resumption of production from Ningxia Zhongwei area clear, the ferrosilicon spot market did not appear cliff-like decline, but downstream manufacturers Observed and explorative the market, the transaction is difficult to take the amount.
Ferrosilicon producers in Zhongwei are expected to be fully normalized by next week, while spot market prices have dropped significantly this week.
Later we should pay attention to the situation of manufacturers’ orders in Ningxia region and the actual supply and demand situation of the market. Short-term in a wait-and-see state, the market or maintain a steady operation, ferrosilicon prices rational adjustment.
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