SHANGHAI, Apr. 10 (SMM) – As the high-water period sets in, expected electricity price decreases will be the major factor boosting operations at silicomanganese alloy producers. SMM sources report regular silicomanganese alloy producers will face with losses. Profits of high-silicon silicomanganese alloy are high, but due to technical restrictions, most silicomanganese alloy producers are unable to produce. Besides, steel plants were pushing down prices given ferroalloy oversupply, and purchase by acceptance, with ferroalloy producers falling short of cash flow at a time. SMM believes silicomanganese alloy market will be sluggish.

On the steel plants side, as steel prices stabilized, steel inventories began to fall. According to a CISA report, inventories at major steel producers were 13.71 million mt, down 5.57% from ten days ago. By April 5th, inventories of major five steel categories in major domestic cities were 21.63 million mt, down 1.42%. Given supply surplus, market players believe steel prices will fluctuate or advance slightly in the near term, with any increases limited, and will fall again for the foreseeable future.