China Ferroalloys Online, November 22, 2017: Following last week's robust surge in the silicon metal market, this week's market has been relatively calm. A polarized market structure has been formed, with a price gap of 1,000 yuan/ton still prevailing among large, medium, and small enterprises. Inner Mongolia's major factories are still quoting 72# at 7,600 yuan/ton ex-factory and 8,000 yuan/ton delivered. Factories note that although there are some advance orders yet to be fulfilled, actual transactions have been few since the price increase, with a low level of downstream acceptance. Small and medium-sized enterprises, on the other hand, are largely maintaining prices at 72# between 6,500 and 6,600 yuan/ton. Some companies in the Zhongwei region are quoted at 6,800 to 6,900 yuan/ton, with most actual transactions fluctuating around 6,600 yuan/ton. Prices vary according to different regions, based on the cost and production conditions of individual enterprises.

Currently, most factories still have little to no inventory, and some are still fulfilling early low-price orders. In this surge in market prices, traders are actively urging for deliveries, shifting the inventory pressure onto them. If traders are optimistic about the future market, holding onto their goods, the supply will remain tight. However, if traders start shipping out in large quantities, the increase in on-hand stock may make it difficult to sustain the prices. In Anyang trading area, the cash-in-hand, tax-exclusive price for 72# is now between 5900-6000 yuan/ton, while in the Jiangsu and Zhejiang regions, some transactions have reached a high of 72# at 7400 yuan/ton.

In the short term, the market should focus on the steel mill bidding situation at the end of the month. With spot transaction prices already rising before the steel bids, and major mills showing strong resistance to price drops, there is a high likelihood of an upward trend in the December steel bids. However, it is expected to face pressure above 8,000.