Ferro-silicon prices continued to fall globally over the past month, and while we continue to believe that prices are likely close to a floor, headwinds remain considerable given broad weakness in downstream industries both in China and western economies. In particular, rumours that Chinese mills will be required to cap crude steel output to last year’s level would imply a cut of around 13 on a monthly average basis over August December, equivalent a drop of around 4 on the same period last year. Note that even holding steady on 2022’s level over August-December would require a drop in monthly average output of 10 on a monthly basis, compared to the first seven months of the year, due to a production slowdown last year amid Covid-19 lockdowns.
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