Period review: On Monday, the ferrosilicon 2209 contract fell to close at 9388, and the manganese silicon 2209 contract fell to 8340. In terms of spot, the average ex-factory price of ferrosilicon FeSi72~B in Inner Mongolia is 8,800 yuan, and the average ex-factory price of manganese silicon FeMn65Si17 in Inner Mongolia is 8,200 yuan.
Market overview: On Monday, ferroalloys fell. Affected by the interest rate hike by the Federal Reserve, the risk aversion in the market has heated up, and the black system has collapsed, driving the price of ferroalloy to decline. In the short term, it will maintain a weak level of shock. On the supply side, with the recovery of manganese and silicon prices and the reduction of electricity costs, the operating rate has stopped falling and rebounded. At the same time, the production of ferrosilicon is also at a high level, and the pressure on the supply side is still relatively large. On the demand side, downstream steel mills have abundant inventories and are not willing to purchase furnace charges. At the same time, the demand for steel is weak, the continuous recovery of production power is limited, and the production may be reduced in the later stage. On the whole, the supply is still at a high level, the improvement in demand is expected to be limited, and the momentum for the upside in the later period is insufficient, and it is expected to maintain a weak trend of shocks.
From a fundamental point of view, on the supply side of ferrosilicon, the profit of domestic ferrosilicon manufacturers has dropped significantly in the early stage. Judging from the changes in ferrosilicon production in recent weeks, there are signs of peaking in stages, and the pressure on the supply side is still relatively large. In terms of spot, the amount of steel solicited by major manufacturers in the north increased by 683 tons to 2,099 tons in June, the first round of inquiry price was 9,300 yuan/ton, and the final price was finalized at 9,600 yuan/ton, which was slightly better than market expectations. Market sentiment has picked up. On the demand side, recently affected by the lifting of the lockdown in Shanghai, the month-on-month increase in profitability, and the accelerated advance of the factory warehouse, the steel production status has gradually recovered, and the output has continued to rise. However, in the face of the general environment of the crude steel reduction policy and the realistic conditions of persistently weak demand, there is still a possibility of production reduction in the later stage, and it is unlikely that the production momentum will recover continuously. The price of coke has risen in some regions, and the production cost of ferrosilicon will face upward trend in the future. The downstream demand for magnesium metal has improved, and the price has shown signs of rebounding, and the downward pressure on the demand side of 75 ferrosilicon has been eased. The recent export of ferrosilicon has begun to show signs of weakening. On the whole, although the supply and cost disturbances are expected to boost the short-term sentiment of the market, the contradiction between the strong supply and the weak demand of ferrosilicon itself has not been significantly alleviated, and the trend of weak shocks is still maintained in the later period.
In terms of manganese silicon, on the supply side, the continuous decline in the previous price has caused most of the current manganese silicon manufacturers to turn into losses, and their willingness to actively stagger production has increased. However, with the recent recovery of manganese and silicon prices and the reduction of electricity costs in Guangxi, the operating rate of manganese and silicon manufacturers has rebounded last week, and subsequent production is expected to rise again. On the demand side, traders currently have relatively abundant stocks, and downstream steel mills are not willing to purchase the charge side due to low profits. The steel recruitment in June has basically ended, and there is limited room for further improvement on the demand side of manganese and silicon. On the whole, the output of manganese and silicon will rise again, and the demand will weaken.
Funding comparison: From the perspective of the top 20 positions, the long positions of ferrosilicon (85,238 lots) are smaller than the short positions (90,418 lots), and the concentration of the top seven long positions (59.68%) is smaller than that of the short positions (61.48%).
Manganese silicon longs (85,346 lots) are larger than shorts (77,651 lots), and the top seven concentrated longs (64.98%) are larger than shorts (59.32%).
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