In the first week in 2022, the domestic ferrosilicon market continued to operate steadily. On December 31, 2021, Indonesia announced that it banned coal export from January 1 to January 31, 2022, but the short-term impact seemed limited and didn’t drive any obvious change of ferrosilicon futures. At the beginning of the new year, there were plants in Ningxia, Gansu and other main production areas resumed production, the operating rate and the supplies increased to some extent, and the price of ferrosilicon was expected to continue to be under pressure. However, the production of downstream steel mills also rebounded. The representative steel mills released its bidding information of ferrosilicon 75B in Jan-Feb with a volume of 3396 tons, an increase of 2998 tons compared with December 2021, which injected confidence into the market to a certain extent, but at the same time, the first round inquiry price of its bidding 8500 yuan per ton, which was reduced by 100 yuan per ton compared with last month, which also increased the wait-and-see mood in the market. The Winter Olympic Games will be held soon and we will pay attention to the latest relevant policy progress, bidding pricing of representative steel mills and futures disk trend.

The opening price of 2205 main contract of ferrosilicon futures this week was 8386, the highest price was 8622, the lowest price was 8230, the closing price was 8526, the settlement price was 8488, the trading volume was 583400, and the position was 87518, a decrease of 1.65%.

As to the downstream industries, the impact of policy on the supply side of crude steel will still exist in 2022, but the strength may be less; and the downstream demand for steel is likely to recover in stages compared with that in 2021. With the improvement of production enthusiasm, there is a risk that the profits of steel mills and steel prices will fall in late 2022. This week, the steel supply has picked up, but considering the heating season, the Spring Festival and the Winter Olympic Games are coming, the increment was also limited; In the traditional off-season, the downstream demand continued to be weak, the steel market would enter the inventory accumulation stage, and the shock consolidation would continue in the short term.

The domestic metal magnesium market continued to rise this week. On Friday, the ex-factory cash quotation including tax of 99.9% magnesium ingots in Fugu area was about 51000-52000 yuan per ton. Although the downstream procurement was cautious, the factories didn’t have much inventory pressure or capital pressure, and the environmental protection policy in Shaanxi has not been finalized, and the price of magnesium ingots was not easily to fall in the short term.