Affected by steel mills bringing down the purchase price of ferrosilicon for January-February delivery of 2014, Chinese ferrosilicon producers had continued lowering their quotations since the beginning of January of 2014. Until the middle of January of 2014, FeSi75# had declined to RMB6,350-6,450/mt(USD1,048-1,065/mt) and FeSi72# had declined to RMB6,100-6,200/mt(USD1,007-1,024/mt), some producers even offered quotations for FeSi72# near RMB6,000/mt(USD991/mt), export duty not included, ex-work tax-inclusive price by acceptance.
As some large ferrosilicon producers said, they were pessimistic about the ferrosilicon market before the Chinese lunar spring festival. In addition, the Chinese government had been strictly reducing overcapacity of iron and steel, especially with Hebei, Shandong and Jiangsu provinces. As we learnt, about 10 million mt ofexcessive steel capacity had been cut in China's Tangshan city. Demand for ferrosilicon thus was declining and the steel price was still depressed. FeSi market was expected to run lowly in China before the Spring Festival.