In Q1’26, ferrosilicon prices witnessed mixed trends globally. Ferrosilicon prices in Asia declined in February as steel mills limited purchases to immediate production requirements, while inventories accumulated following the Lunar New Year holiday period. Market sentiment improved in March as rising semi-coke costs, elevated freight expenses, and tighter spot availability encouraged suppliers to raise offers. Production economics also became less favourable due to higher energy-related costs linked to disruptions in Middle East shipping routes. Buyers largely avoided building inventories and continued purchasing only for short-term requirements. Trade flow pressure intensified after vessel movement through Hormuz dropped sharply, with only nine vessels navigating the strait on March 2 compared with 135 vessels/day during February, contributing to concerns over raw material availability and logistics costs across the ferroalloy supply chain.
Analyst Insight
According to Procurement Resource, ferrosilicon prices may remain firm if energy and freight volatility continue in the near term. Any improvement in steel demand would strengthen buying activity.
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In the second half of 2025, ferrosilicon prices in Europe were volatile and unpredictable. Early in H2, prices fell slightly after the uncertainty around the European Commission’s safeguard measures, as buyers hesitated to make purchases. Traders and steel producers were cautious because the rules for tariffs and quotas were unclear, and many waited to see how the market would adjust.
When the safeguards were announced in November, prices jumped sharply. The new tariff-rate quotas and out-of-quota duties created a floor for imports, giving European producers more control over the market. Some companies expected higher costs, while others delayed buying until they fully understood the new system. The changes led to irregular trading, with materials entering the market in bursts as quotas renewed every three months. Smaller companies felt pressure due to higher costs, while larger producers were better positioned to benefit from the new rules.
Overall, supply remained sufficient, but trading patterns changed, and price volatility increased. Export-oriented suppliers from Norway, Iceland, and other regions adjusted their deliveries to fit the new quota system, affecting availability in the market.
Analyst Insight
According to Procurement Resource, Ferrosilicon prices are expected to stay firm with continued volatility, as the quota system and higher import costs reshaped European trading in early 2026.
Ferrosilicon (FeSi) is a silicon and iron alloy where both chemical substances are mixed in varied ratios. It looks like a crystalline solid alloy metal which has no odour. It is flammable and can explode with oxidizing materials and emits toxic and explosive fumes in the presence of moisture. It is mainly used as an alloying component for deoxidation in steelmaking and magnesium processing.
FeSi
In deoxidizing steel, manufacturing of other ferroalloys, in the metallurgical industry, for manufacturing silicon copper, semiconductors, ferrous silicon alloys, magnesium, magnesium ferrosilicon, as a component in electrode coatings for arc welding.
Iron-Silicon Alloy
China Minmetals Corporation, Ferroglobe, OM Holdings Ltd., Elkem ASA, Eurasian Resources Group, Ferro Alloys Corporation Limited (FACOR), Russian Ferro-Alloys Inc., SINOGU CHINA, VBC Ferro Alloys Limited
CurrencyUS$ (Data can also be provided in local currency)
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Ferrosilicon is produced by smelting a mixture of iron ore, coke, and silica in a high-temperature electric furnace. The coke reduces the iron ore, resulting in elemental iron. Silicon is added, reacting with the iron to form ferrosilicon. The molten ferrosilicon is then tapped, cooled, and solidified into ingots or granules.
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