Report Investment Rating - No investment rating information is provided in the report. Core Views - The core contradictions affecting the ferroalloy market include the imbalance between high supply and weak demand, challenges to cost support, and the conflict between anti - involution expectations and weak reality. Ferroalloy prices are under pressure due to weak downstream demand, high inventory, and international trade frictions. However, there is also a possibility of short - term rebounds driven by market expectations for policy changes [2][3]. Summary by Directory Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - The contradiction between high supply and weak demand: Ferroalloy production profit is declining, and downstream demand shows no obvious improvement during the peak season. Silicon iron production has started to decline, while silicon manganese production increased slightly this week. Both silicon iron and silicon manganese inventories are at a five - year high, with silicon iron enterprise inventory up 4.5% and silicon manganese enterprise inventory up 8.2% week - on - week [2]. - Challenges to cost support: Although the prices of raw materials such as semi - coke, electricity, and manganese ore are stable, the high - supply and weak - demand pattern challenges the effectiveness of cost support. The rising coking coal price provides some support, but there is a risk of price decline if the meeting results are disappointing [2]. - The contradiction between anti - involution expectations and weak reality: The market still has expectations for supply - side contraction, but there is a lack of substantial action, leading to a high risk of price fluctuations. International trade frictions and weak steel fundamentals further suppress ferroalloy demand [3]. 1.2 Trading Strategy Recommendations - Trend judgment: Technically, the 10 - day moving average of ferroalloy is moving downwards and has broken below the 60 - day moving average. However, the shrinking green bars of MACD indicate weakening downward momentum. There is a possibility of a short - term rebound, but there will be pressure on the upside due to the poor fundamentals [12]. - Price range: The price range of the silicon iron main contract 2601 is 5200 - 6400, and that of the silicon manganese main contract is 5500 - 6500 [12]. - Basis, calendar spread, and hedging arbitrage strategies: The basis is expected to narrow slightly, and there is currently no basis strategy. For the calendar spread, although the 1 - 5 spread of ferroalloy is at a five - year low, it is not recommended to go long. The spread may further weaken, but the risk of reverse arbitrage is also high [12]. 1.3 Industrial Customer Operation Recommendations - Price range forecast: The monthly price range of silicon iron is 5300 - 6000, with a current 20 - day rolling volatility of 17.37% and a historical percentile of 43.9% over three years. The monthly price range of silicon manganese is 5300 - 6000, with a current 20 - day rolling volatility of 11.24% and a historical percentile of 9.6% over three years [13]. - Inventory management: For enterprises with high finished - product inventory, it is recommended to short ferroalloy futures to lock in profits and hedge against inventory depreciation. The recommended short - selling ratio is 15%, with an entry range of 6200 - 6250 for silicon iron and 6400 - 6500 for silicon manganese [13]. - Procurement management: For enterprises with low procurement inventory, it is recommended to buy ferroalloy futures to lock in procurement costs. The recommended buying ratio is 25%, with an entry range of 5200 - 5300 for silicon iron and 5300 - 5400 for silicon manganese [13]. Chapter 2: This Week's Important Information and Next Week's Key Events 2.1 This Week's Important Information - Positive information: The National Development and Reform Commission and the State Administration for Market Regulation issued a notice on regulating price competition. The Fourth Plenary Session of the 20th Central Committee is expected to introduce policies for stabilizing the real estate market and reducing involution [14][15]. - Negative information: The EU has tightened steel import restrictions, and Mexico plans to impose additional tariffs on Chinese steel and automobiles. Sino - US trade frictions and weak steel fundamentals have dampened market sentiment [16]. - Weekly data: Silicon iron production decreased by 0.3 to 11.28, and silicon iron plant inventory increased by 3050 to 69080. Silicon manganese production increased by 4585 to 208810, and silicon manganese plant inventory increased by 20000 to 262500 [16]. 2.2 Next Week's Key Events - Next Monday, China's Q3 GDP annual rate, one - year loan prime rate, and cumulative year - on - year growth rate of fixed - asset investment will be released. Next Friday, the US September unadjusted CPI annual rate will be announced. The evolution of Sino - US trade frictions also needs attention [17]. Chapter 3: Market Interpretation 3.1 Price, Volume, and Capital Interpretation - Unilateral trends and capital movements: The closing price of the silicon iron main contract 2601 was 5430, up 0.63% week - on - week, and the total open interest increased by 8.6% to 411,000 lots. The closing price of the silicon manganese main contract 01 was 5718, down 0.69% week - on - week, and the total open interest increased by 5.85% to 598,000 lots. The net short position of silicon iron is increasing, while the net short position of silicon manganese is decreasing [17]. - Basis, calendar spread, and structure: The term structure of ferroalloy is in contango, but the term structure of some silicon iron contracts is improving. The contango structure of coking coal is bearish for ferroalloy prices in the short term. The basis of ferroalloy is fluctuating narrowly, and the 1 - 5 calendar spread is at a five - year low. It is not recommended to go long, and the spread may further weaken [21][22]. Chapter 4: Valuation and Profit Analysis 4.1 Upstream and Downstream Profit Tracking - Ferroalloy profit is continuously declining. Silicon iron production remains high, giving enterprises a strong incentive to cut production. Silicon manganese production has been falling for several weeks [40]. - The export profit of silicon iron is declining, and its export volume is expected to decrease [64]. Chapter 5: Supply, Demand, and Inventory Projections 5.1 Supply - Demand Balance Sheet Projection - Supply: Although there is an expectation of increased production during the peak season, the continuous decline in production profit is likely to lead to a decrease in ferroalloy production. The production of silicon manganese in the southern region may also decline with the arrival of the flat - water season [68]. - Demand: Seasonally, ferroalloy demand should increase during the peak season, but the decline in the profit of downstream products such as rebar and hot - rolled coils, along with the accumulation of five - major steel products' inventory, restrains the demand for ferroalloy. The demand for ferroalloy is expected to decline slightly [68]. - Inventory: Warehouse receipts are expected to continue to be destocked due to approaching forced cancellation months and seasonal patterns. Total inventory is expected to decline slowly [68]. 5.2 Supply - Side Projection - The decline in production profit does not support an increase in ferroalloy production. The production of silicon manganese in the southern region may decrease with the flat - water season. Silicon iron production is expected to decline slightly due to a significant drop in production profit [70]. 5.3 Demand - Side Projection - The demand for ferroalloy is affected by the weak profit of downstream products and the accumulation of five - major steel products' inventory. The high - level iron - water production is difficult to maintain, and the steel - making demand for ferroalloy may decline. The decline in silicon iron export profit will also affect its export volume [74]. 5.4 Inventory - Side Projection - Given the high operating rate of ferroalloy enterprises and weak downstream demand, enterprise inventory is likely to continue to accumulate. However, warehouse receipts are expected to be destocked, and total inventory will decline slowly [90].
南华期货铁合金周报：下游弱需求，挑战成本支撑的有效性-20251019
Nan Hua Qi Huo·2025-10-19 13:58