It’s been long since we started talking about ferrosilicon (FeSi) smuggling in China and it still affects the whole export market greatly nowdays.
Domestic FeSi price of China continued to decline while export price dropped below USD1400/mt. As far as we know, although quotation from most export enterprises was still USD1400-1430/mt, actual transaction price was already under USD 1400/mt. Some foreign traders were said to be negotiating, but their offer was no better than the price.
It was reported that Japan, the biggest export market of China’s FeSi, had determined its FeSi purchase price in the second quarter, which increased by yen20000/mt (USD200.8/mt). Japanese giant mills set their FeSi procurement price at yen140000-142000/mt (USD1500-1520/mt). However, Japanese market was filled with FeSi imported from Vietnam, which lowered spot price to around USD1300/mt. Therefore, offer from Chinese traders was short of competitiveness and fewer transactions were made.
FeSi export market could not improve unless smuggling is eliminated, which could be achieved only if export tariff is adjusted. A vicious circle has formed at present. Only by market regulation, backward capacity elimination, industry upgrading and environmental technology application could we break the circle and get rid of all kinds of policy restrictions.