futures Market
The main silicon iron contract for November closed at 5,638, up 0.21% (+12), with a daily increase in open interest of 3,215 (yuan/ton). Spot Market: Market sentiment for silicon iron is generally stable, with spot prices undergoing minor adjustments. In the main production areas, 72% silicon iron natural blocks are priced at 5,300-5,400 yuan/ton (cash, tax-inclusive ex-factory), while 75% silicon iron is quoted at 5,800-5,950 yuan/ton.
Supply Side: Recent silicon iron production has remained largely unchanged, with spot prices experiencing a slight decline. As the futures market fluctuates, low-priced spot market resources have emerged, and transactions at lower price levels remain acceptable. Currently, most manufacturers are producing on a backlog basis, with limited expectations for resumption of production in the near term. According to reports, some production areas anticipate a 2-cent increase in electricity prices in the future, which may provide some support for silicon iron costs. The coke market remains stable, with small-sized coke ex-factory prices reported at 610-730 yuan per ton (cash, tax-inclusive).
Downstream
Some steel mills in northern China have begun to reduce production, but overall, the extent of production cuts has fallen short of expectations. Demand for silicon iron from downstream industries has remained at a relatively stable level. However, recent declines in market sentiment have led to lackluster trading activity in the silicon iron market. Manufacturers report that overall trading performance has been poor, with transaction volumes shrinking. Traders continue to engage in back-to-back operations, replenishing inventories of low-priced resources as needed. The magnesium metal market is showing a weak but stable trend. Although factory inventories are at low levels, market procurement sentiment remains lackluster. Recently, some magnesium plants have resumed production, leading to a slight increase in supply. The mainstream ex-factory cash price (including tax) for 99.90% magnesium ingots in Shaanxi is around 17,200-17,300 yuan per ton.
In summary, short-term demand for silicon iron is expected to remain weak and stable. Steel mills have concluded their August tenders, with reduced procurement enthusiasm. Traders are cautious about speculative demand, and silicon iron spot prices are in an oscillating phase. Manufacturers maintain a cautious and observant stance toward future market trends, with strong willingness to replenish inventories at lower prices.
