December 03, 2008

China\'s ferrosilicon exports likely to fall in 2008

Platts cited Mr Gao Xu general manager of Dragon Northwest Ferroalloy while speaking at the Metal Bulletin's 9th Asian Ferroalloys Conference in Hong Kong as saying that Ferrosilicon exports from China is expected to be cut to around 1.2 million tonnes to 1.3 million tonnes in 2008, as compared with about 1.537 million tonnes produced in 2007.

Mr Gao said ferrosilicon exports in 2008 would be pulled down by the anti dumping duties imposed by the European Union, the 25% export tariff in China and rising domestic prices of raw materials including coke and power.

He said that domestic demand for ferrosilicon in China this year would be around 3.8 million tonnes. Of the total consumption, ferrosilicon used in iron and steel industry is expected to be around 2.54 million tonnes. Mr Gao said "Consumption of ferrosilicon in the iron and steel sector in China will gradually reduce due to the use of substitutes. However, its application in magnesium production will rise. Magnesium metal production in China is expected to rise in 2008 and based on this, the consumption of ferrosilicon in the magnesium sector will reach about 910,000 tonnes."

Mr Gao also said that ferrosilicon output capacity in 2008 will raise to at least 9 million tonnes by the end of 2008, but only about 45% to 66% of the total capacity will be in operation. Output this year is set to be around 5.2 million tonnes. Ferrosilicon output in 2007 was about 4.9 million tonnes. He said that "More ferrosilicon production plants in China have increased their production scale through resource integration and joint cooperation. More new enterprises are now with a production capacity of at least 100,000 tonnes per year."