This week I visited several ferrosilicon shippers stationed at Tianjin Port and talked with multiple mill salesmen in Inner Mongolia and Qinghai, combining real-time overseas customer inquiries to sort out the latest market changes. Compared with last month, the whole market sentiment has turned noticeably weaker, with obvious differences in acceptance among buyers from different regions.
Current FOB Transaction Prices at Major Northern Ports
All prices quoted below are VAT-inclusive natural lump ferrosilicon, prices for special specifications such as low-aluminum and powder need separate negotiation.
For standard 72# ferrosilicon, most spot suppliers at Tianjin Port offered USD 1150 to 1170 per metric ton FOB, and most bulk long-term deals signed last week settled near USD 1175/MT. Some small scattered orders with less than 500MT cargo were willing to cut prices down to USD 1140-1150 just to clear inventory.
Shippers based in Lianyungang and Rizhao faced weaker demand from Southeast Asian buyers, so their overall quotations were USD 10-15 lower than Tianjin, mostly ranging from USD 1145 to 1165/MT.
As for high-grade 75# ferrosilicon, which is mainly supplied to Japanese and South Korean steel plants, the general offer stayed at USD 1200-1220/MT, and the actual average transaction price recorded by port traders last week reached USD 1235/MT.
It's worth noting that special grades like low-carbon ferrosilicon will add an extra premium of USD 30 to 80 per ton, and the specific premium depends on order volume and delivery schedule agreed by both sides.
Real Changes Seen in Offshore Buying Demand
From my daily communication with overseas purchasers recently, FOB prices barely moved in the past two weeks, only fluctuating within a narrow range. Domestic factory spot prices kept sliding, forcing export sellers to adjust offers downwards, while foreign buyers kept pressing for lower prices whenever they sent inquiries. Right now long-term contract orders take up most trading volume, and sporadic spot inquiries from speculative traders have decreased sharply.
Buyers' willingness to purchase varies widely by region:
Steel manufacturers from Japan and South Korea follow fixed monthly procurement plans, their demand is rigid and stable, and they can accept prices around USD 1170 to 1200 per ton without too much bargaining.
Indian and Southeast Asian importers hold a much more pessimistic attitude toward the market. They keep offering bids at USD 1120-1140/MT, and very few deals can be closed at such low levels.
European buyers have cut purchasing volume recently due to the impact of carbon tariffs, the extra premium European clients used to accept has almost disappeared, and most local steel mills choose to reduce stock levels first.
In the flood season, hydropower in Qinghai and Ningxia brings loose production capacity, and domestic downstream steel industry enters off-season, so many smelters choose to divert excess goods to export markets to ease inventory pressure, which largely limits the upward space of FOB prices. Besides, unstable RMB exchange rates also make many export traders more cautious, as exchange losses will further compress thin profit margins.
Correlation Between Domestic Factory Prices and Export FOB Quotation
The current ex-factory tax-inclusive price of domestic 72# ferrosilicon is between RMB 5500 and 5550 per ton. After calculating port handling fees, customs declaration costs, export tax rebates and warehousing expenses, the converted offshore price falls into the current USD 1150+ range.
Many Inner Mongolia smelters told me they would cut maintenance plans if prices slide to RMB 5600-5620/MT, this cost line has become an obvious resistance level, corresponding to FOB USD 1180 per ton in export markets. If domestic futures and spot prices rebound later, export FOB offers will follow up accordingly; if domestic spot keeps falling without stop, FOB prices may break below USD 1140.
Domestic Futures Market Performance & Short-Term Outlook
As of the closing on June 16, the main SF2609 ferrosilicon futures contract settled at RMB 5750 per ton, falling 76 yuan in a single day with a decline of 1.3%. The whole market is stuck in weak consolidation, and there is no sustained upward momentum for the time being.
Most smelters in Inner Mongolia are operating at a slight loss under current quotations. Once prices break the cost support of RMB 5600, we expect a wave of concentrated production suspension and equipment maintenance. Downstream steel mills only purchase goods to meet daily production needs, and there is no large-scale restocking plan in the short term. Continuous accumulation of factory inventory also restricts the recovery of spot prices.
Looking ahead to the next two to three weeks, the ferrosilicon market still lacks strong bullish driving factors, and the overall operation range is roughly RMB 5450 to 5900 per ton. When prices pull back to the cost support zone near RMB 5600, the downside risk will shrink significantly. A clear upward breakout can only happen when large-scale production cuts take place in core producing areas or steel plants launch centralized replenishment.
Personal Reminder for Market Participants
All data and judgment in this article are based on port interviews, factory communication and public industry data, only for market reference. Ferrosilicon spot and futures prices swing frequently, every trader should combine their own capital cycle and supply chain situation to make decisions independently. We do not bear any losses caused by direct trading operations according to this article's content.
