China ferrosilicon has a large user base in the world and is widely used in steelmaking and casting applications, these users purchase large amounts of ferrosilicon from China every year to maintain their production operations. Therefore, the fluctuation of the price of ferrosilicon in China will have a direct impact on the production costs of the users, and we need to understand specifically the reasons that affect the price of ferrosilicon in China so that we can better grasp the timing of buying ferrosilicon, which will not only reduce the purchase costs but also provide a better understanding of the market situation of ferrosilicon in China.
Raw material prices
Raw materials such as quartz stone, coke and steel scrap are direct factors affecting ferrosilicon prices, and many Chinese manufacturers are purchasing raw materials at different prices, mainly because ferrosilicon production will affect the amount of raw materials purchased, and large ferrosilicon manufacturers often have their own raw material procurement channels, and prices can be more favourable compared to smaller ferrosilicon manufacturers. Therefore, large manufacturers are also lower in terms of ferrosilicon prices.
Electricity costs
Ferrosilicon production processes commonly use electric furnaces for smelting and therefore require large amounts of electrical energy. In China, the cost of electricity varies from region to region and generally in areas with abundant coal resources and more rainfall, you will often find more ferrosilicon plants, mainly because the main methods used to generate electricity are coal and hydroelectricity, and ferrosilicon manufacturers need a lot of electricity to produce ferrosilicon, and the cost of electricity is lower in these areas, so it is common to build plants in areas with abundant coal and hydroelectric resources.
Policy
In China, policies vary from region to region. For example, during periods of environmental protection, policies require ferrosilicon manufacturers to limit production, which can result in a significant reduction in the amount of ferrosilicon on the market, and even out-of-stock situations can occur, resulting in higher ferrosilicon prices.
Holidays
In China, policies vary from region to region. For example, during periods of environmental protection, policies require ferrosilicon manufacturers to limit production, which can result in a significant reduction in the amount of ferrosilicon on the market, and even out-of-stock situations can occur, resulting in higher ferrosilicon prices.
After analyzing the reasons that affect the price of ferrosilicon in China, we can see that if we want to buy ferrosilicon from China at a more favorable price, then we should avoid several of these factors and it is best to wholesale ferrosilicon from manufacturers when the price of ferrosilicon is at a low trend to gain more profit in order to prevent higher prices. If you encounter higher prices for ferrosilicon, consider using ferrosilicon briquettes instead of ferrosilicon, they have the same properties and effects.