Factors Affecting Ferrosilicon Price Changes
Apr 28, 2025
Factors affecting ferrosilicon price changes
1. Macroeconomic policies
From the downstream of ferrosilicon, we can know that when the national economy recovers, the infrastructure industry recovers, and the steel industry has strong demand, it will increase the demand for ferrosilicon and increase exports.
2. Transportation costs
The main concentration areas of ferrosilicon and steel industries in my country are relatively scattered, and the difference between production and consumption places leads to high transportation costs for ferroalloys. Ferroalloys in western provinces can be transported by rail, with relatively low costs; road transportation costs are higher.
3. Periodic changes in demand
The ferrosilicon pricing mechanism and seasonal factors in the production of downstream steel mills will affect the demand for ferrosilicon and lead to periodic fluctuations in the price of ferrosilicon.
In terms of pricing mechanism, due to the centralized procurement of steel companies at specific times each month, the demand decreases during non-procurement periods, and the price will be affected by short-term fluctuations and fall.
In addition, the seasonality of steel mills' own production will also lead to fluctuations in demand. For example, during the Spring Festival, steel mills generally choose to concentrate on replenishing inventory, thereby increasing the demand for ferrosilicon in the short term and pushing up the price of ferrosilicon.
4. Raw material prices
Ferrosilicon is an iron alloy made of silicon, iron and coke. Its price is naturally affected by the prices of raw materials such as iron, silicon and coke. As the price of raw materials rises, the cost of synthesizing ferrosilicon will increase, and the price of ferrosilicon will also rise.
5. Electricity prices
Ferroalloys are energy-intensive industries, and electricity accounts for a relatively high proportion of their costs. In the current economic environment, coal-fired power generation is still the mainstream, but the resources are used less and less, and the cost of power generation in power plants is getting higher and higher, and then the price of electricity will continue to increase, which makes the costs of major manufacturers increase accordingly.
