China: Ferro silicon market largely stable with slight downward bias amid weak futures

• Prices edge down w-o-w
  
  
• Cautious steel demand keeps trade muted
  
  

Ferro silicon (Si 75%) prices in China remained largely stable, edging down marginally w-o-w to RMB 6,000-6,150/t ($877-900/t) ex-factory, inclusive of taxes, from RMB 6,100-6,150/t ($892-900/t) in the previous week.

Meanwhile, Si 72% prices were also stable with a slight downward trend, easing to RMB 5,6005,750/t ($819-841/t), compared with RMB 5,650-5,850/t t ($826-856/t) earlier.

Chinas domestic ferro silicon market remained largely stable on a weekly basis, with marginal downward pressure, as weak futures sentiment and cautious downstream demand offset cost-side support.

Market updates

Stable costs support market amid weak futures:

Domestic ferro silicon prices remained supported by stable-to-firm electricity and raw material costs. However, futures prices trended lower amid weakness in the broader ferrous sector and geopolitical uncertainties, weighing on sentiment.

On the supply side, operating rates remained relatively low, while expectations of production resumption and gradual inventory build-up persisted. Producers maintained firm offers, limiting sharp declines.

Cautious demand limits activity:

Downstream demand remained subdued, with steel mills continuing need-based procurement and showing resistance to higher prices. Trading activity stayed sluggish, with transactions largely limited to immediate requirements.

Market participants maintained a wait-and-watch approach amid weak futures trends and uncertain macro conditions.

Outlook

The ferro silicon market is expected to see moderate fluctuations in the near term. While high costs will continue to provide a price floor, slow demand recovery and potential inventory build-up may limit upward momentum.

If supply increases while demand remains weak, prices may face downward pressure; however, any improvement in demand could provide support.

(With inputs from CBC)