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|Market Trend of Import of Ferroalloy as of 13 January 2017|
|= Prices of ferroalloys drop by and large in China before Chinese New Year =|
The market trend of import of ferroalloy as of 13 January 2017 is as follows.|
<> Silicon Metal = The price of silicon metal in the Chinese domestic market continued declining only slightly during December and also dropped by a minor range after the turn of the year, but almost stops declining at the present moment. The current prices of 553 and 441 grades were down by CNY200 per ton and down by CNY400 - CNY500 per ton respectively from the end of December. At the present moment, many of the producers are preparing for shut-down or having a maintenance work for Chinese New Year holidays (from January 27 to February 2), and the producers which rush for selling can't be seen. On the one hand, the aluminium alloy producers which are a main user for low-grade silicon metal are lowering the operating rate, and the activities in the market become dull owing to both demand and supply being down as well as the trading being thin.
As to the export, there is no last-minute demand before Chinese New Year nor movement to hasten the shipment, and the situation of the price being unchanged is ongoing. The offer price for 553 grade is down by US$40 from the end of December, but the same for 441 grade remains at being down by US$10 ditto.
In the Japanese domestic market, the trading is thin on alert against the fluctuations in exchange before inauguration of new U.S. President Trump. This is because the more precautions are taken against the occurrence of backwardation due to fluctuations in exchange than against the ups and downs in the product prices. The contract price dropped during the end of the year to the beginning of the year, and was down by around US$30 from the previous case (as of December 26).
<> Ferro-silicon = Albeit the Government of China reduced provisional export duty rates on ferro-silicon (both Si>55% and Si</= 55%) to 20% from 1 January 2017, it is difficult at the moment to recognize the impact from the decreased duty rates because the realization sales before Chinese New Year occurred simultaneously in the overseas market after the turn of the year and the change in setting the minimum export prices at the respective custom houses got delayed.
Currently, as many of the producers in China reduce the operating rate before Chinese New Year holidays, the supply volume to the market is going down. However, since the customers including steel mills also decrease the purchase volume so as to reduce the operating rate, there is no feeling of the supply being tight. But, as the small and medium-sized ferro-silicon producers are rushing for cashing by way of realization sales, the prices of products with Si being 72% and 75% meant for Chinese domestic market were down by around CNY400 per ton and down by around CNY 200 per ton respectively from the end of December. As to the export, many of the ship owners show reluctance to load cargoes and sail from the port before Chinese New Year, and the shipments stipulated in the contracts inked by the producers and trading firms were changed to February.
The contract price of Chinese products regularly exported to Japan was down by US$60 - US$70 from the end of December.
As to Malaysian ferro-silicon, the contracts are mainly for shipments during February to March, and some producers have already sold out the cargoes for February shipment. The contract price is down by US$50 - US$60 from the end of December.
As to Russian ferro-silicon, the cargoes for February shipment were sold out, and the offer price for March shipment is now submitted. The contract price is down by US$5 - US$25 from the end of December.
<> Silico Manganese = In China, a relatively high electricity rate for a low-water season is applied in some parts of the southern area, and the shut-down of the producers whose production costs are more than the product prices has been prevailing furthermore. However, the contract price continues dropping for such reasons as (1) There is no feeling of the supply being tight in the domestic market because the steel mills reduce the purchase volume of raw materials before Chinese New Year, (2) The retail price of imported manganese ore as raw materials is going down and (3) As the producers start realization sales, the price continues declining slightly at the moment.
The difference between top and bottom offer prices in India remains at being widened. As to 6517 product (Mn: 65%, Si: 17%) meant for export, there is an information in the market that the supply instability has yet to be removed, but the price of manganese ore as February shipment will be down. In view of this, while the traders with a strong desire to sell lower the offer price, many of the producers are taking a negative stance for price cut.
The contract price of Indian silico manganese in Japan was down by US$50 per ton from the end of December.
As to Malaysian silico manganese, OM Sarawak had a first tapping on December 18 following Pertama Ferroalloys which had a first tapping in August 2016, and started production. But, both companies have yet to submit an offer price for the cargoes to be shipped during January to February.
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|last modified : Fri 20 Jan, 2017 [10:12]|