The FOB price of ferrosilicon refers to the price of ferrosilicon delivered on board the ship at the port of shipment. FOB is the abbreviation of "Free on Board". The FOB price of ferrosilicon means that the seller completes the delivery obligation after loading the ferrosilicon onto the ship designated by the buyer at the designated port of shipment, and the subsequent freight, insurance and other costs and risks are borne by the buyer. Under this price clause, the seller is responsible for transporting the goods to the port of shipment and loading them on the ship, and bears all costs and risks before the goods cross the ship's rail at the port of shipment. The buyer is responsible for chartering a ship, paying freight, and bearing all costs and risks after the goods cross the ship's rail.
Influencing factors
Market supply and demand relationship:
When the ferrosilicon market is oversupplied and supply exceeds demand, the FOB price tends to fall; conversely, if the market demand is strong and supply is tight, the FOB price will rise.
Raw material costs:
Silica, semi-coke and electricity are the main raw materials and energy sources for the production of ferrosilicon. When the prices of these raw materials rise, the production cost of ferrosilicon increases, and the FOB price may also rise accordingly; conversely, a decline in raw material prices will cause the FOB price to tend to fall.
Macroeconomic situation:
When the global economy is growing strongly, infrastructure construction and industrial production activities are active, and the demand for ferrosilicon in industries such as steel increases, which will drive up the FOB price of ferrosilicon. When the economy is in recession, demand shrinks and the FOB price of ferrosilicon may be suppressed.
Policy factors:
The strict implementation of domestic environmental protection policies may cause some ferrosilicon manufacturers to face rectification or suspension of production, affecting market supply and thus FOB prices. Adjustments to import and export policies, such as changes in tariffs and export tax rebate policies, will also directly affect the domestic and foreign trade of ferrosilicon, and thus affect FOB prices.
International trade situation:
Trade frictions, trade protectionist policies, etc. may restrict the import and export of ferrosilicon, affect the balance of market supply and demand, and cause fluctuations in the FOB price of ferrosilicon. Exchange rate fluctuations will also affect the FOB price of ferrosilicon. The appreciation of the domestic currency may cause the FOB price of ferrosilicon denominated in the domestic currency to rise relatively, which is not conducive to exports; the depreciation of the domestic currency may cause the FOB price to fall relatively, which is conducive to exports.
