In December 2022， the ferroalloy market is expected to break out, paying attention to business opportunities
Ferroalloy market is strong, steel plant replenishment critical period
Positive policies continue to be introduced and steel mills replenishment of less than expected good news, the ferroalloy market is expected to reach this round of rise. This week, molten iron production fell more than expected, the latest data daily average molten iron production of 2.21 million tons, the cumulative decline reached 7.5%, steel mill profit margin maintained a low 22.5%.
The weakening of production intensity and profits has led to the reduction of ferroalloy consumption and the replenishment of steel plants. From mid-December to the Spring Festival, the consumption demand for ferroalloy in steel mills will not decline. Considering that the profitability of steel mills is still weak, the seasonal demand is small and it is difficult to change the current situation, steel mill consumption demand for ferroalloy will not see a significant increase.
The future replenishment demand of steel mills will determine the demand for ferroalloy in December. Ferro silicon inventory is less than 17 days, and silico manganese inventory is less than 18 days, which has been at the lowest level in recent years. Under low inventory, steel mills have a demand for replenishment.
In December, the price of ferro silicon was 8700 yuan/ton, and the price of silicon manganese was 7,600 yuan/ton, which slightly increased from the price of the previous month.
Ferroalloy supplies remain high
The weekly output of ferrosilicon is 112,700 tons. This round of steel mills reduced production, and ferroalloy manufacturers are still expanding production. The raw material price of ferroalloy decreased and the spot market price rose slightly, and the profit of ferrosilicon production enterprises was about 500 yuan/ton more than that in November.
The output of silicon manganese per week is 1980,000 tons, and the supply remains high. The prices of the main raw materials of silicon manganese began to rise, and the cost of production continued to rise, but the shrinkage of profit has not reduced production.
According to the current production intensity, after the Spring Festival, the inventory of the ferrosilicon factory exceeds 100,000 tons, and the inventory of the silicon manganese factory exceeds 300,000 tons. However, after worrying about this, you need to wait for the steel plant to be traded. At present, as the price rises slightly, inventory pressure is not great.