Most of the Q3 (July - September) price negotiations in Yen with EF mills for ferrosilicon were settled last week at reduced level of prices from those for the preceding quarter.

The reasons behind the cut are, (i) steel production at EF mills is reduced during the Q3 (July - September), meaning less demand for the alloys; (ii) the downtrend in prices of the alloys is prompting trading firms to quickly liquidate stocks.

The prices of ferrosilicon in the past two quarters i.e. January through June this year had been settled at between Yen125,000 - 128,000/ton, but Q3 prices were settled at Yen120,000 - 125,000/ton, down Yen3,000 - 5,000/ton from the preceding quarter. The offers from China are apparently almost unchanged at US$1,400/ton CIF or a little more, but the oversupply situation of the alloy in China generated by low demand and higher production is quietly affecting the prices in actual export deals from China.