Core Facts
Alloy futures prices traded in a fluctuating pattern, while spot prices rose moderately. Regional supply divergence is apparent: a newly established ferrosilicon producer in Gansu halted production due to high electricity prices, while low-cost regions plan to resume production as spot prices improve. Whether the uptrend can extend will depend on the August steel mill tender and steel mill resumption circumstances.
Projects and Capacity
A northern steel mill has launched its August tender, with the volume expected to increase moderately. If steel mills gradually resume production, restocking demand will improve. At present, steel output remains low and restarts are uncertain. Silicon-manganese valuations are low with earlier production cuts, but high inventories are a cap; sustained price gains require terminal demand improvement. Regarding strategy, short out-of-the-money call options on the September ferrosilicon contract remain held, while waiting for potential long opportunities in the November contract.