Core Viewpoint - In the second quarter, the silicon iron market experienced weak price performance primarily due to a downward shift in cost dynamics, with prices dropping from 6000 CNY/ton to approximately 5300 CNY/ton as electricity costs decreased and demand remained weak [1][4]. Supply and Demand Analysis - From June to July, the silicon iron supply side showed a mix of production resumption and maintenance, while downstream demand was weak due to the off-season, leading to a slight weakening of the supply-demand balance [1][4]. - The demand from downstream steel mills remains resilient in the short term, but non-steel demand has shown signs of fatigue, particularly with magnesium production facing profit declines, resulting in maintenance at magnesium plants in Shaanxi and Xinjiang [4]. Cost Dynamics - The mid-term electricity prices are expected to show a stable but slight downward trend, with risks of narrow declines in the cost side [2][3]. - The price of Shanxi lump coal has decreased from 655 CNY/ton to 600 CNY/ton, contributing to the downward shift in silicon iron costs [3]. - The electricity price adjustment in the Ningxia region, which saw a reduction of 0.02 to 0.06 CNY/kWh, significantly impacted silicon iron costs, with expectations of a potential cost reduction of 80 CNY/ton based on projected electricity price declines [3]. Market Outlook - The overall supply pressure may slightly increase due to the resumption of production in the Ningxia region, while some factories in other regions may undergo short-term maintenance due to profit pressures [4]. - The silicon iron market is expected to face a weakening supply-demand balance, with inventory depletion rates likely slowing down [4]. - Despite potential short-term rebounds in silicon iron prices, the combination of weakening supply-demand dynamics and declining costs suggests a bearish outlook for the market [4].

Supply - The operating rate of 136 independent silicon iron enterprises is reported at 31.22%, a decrease of 1.31% from the previous period [4] - The average daily output is 13,365 tons, down by 1,335 tons compared to the last period, with a weekly supply of 93,500 tons [4] Demand - Weekly demand for five major steel types of silicon iron is 20,336.3 tons, a decrease of 2.00% from the previous week [5] - Total production of five major materials is 8.6835 million tons, down by 58,200 tons, with total inventory at 14.3066 million tons, a decrease of 454,100 tons [5] - Social inventory is 9.9367 million tons, down by 393,700 tons, while factory inventory is 4.3699 million tons, down by 60,400 tons [5] - The demand for metal magnesium remains stable, but market sentiment is cautious with limited downstream demand [5] Cost and Profit - The overall market for Lantan remains stable, with prices in the Fugu area around 605-720 yuan/ton [3] - The production costs for immediate production in Inner Mongolia, Qinghai, and Ningxia are 5,518 yuan/ton, 5,708 yuan/ton, and 5,469 yuan/ton respectively [3] - Immediate profits in Inner Mongolia and Ningxia are reported at -118 yuan/ton and -119 yuan/ton respectively [3] Market Outlook - The main contract for silicon iron futures shows fluctuations, with daily output decreasing and supply pressure easing [6] - The overall inventory remains at a medium-high level, with profit differentiation among manufacturers leading to reduced production for loss-making companies [6] - The cost of Lantan remains stable, and there is potential for electricity prices to rise in Ningxia, indicating a possible end to short-term price disturbances [6] - The supply-demand imbalance for silicon iron has significantly eased, but short-term demand lacks support, leading to expectations of price fluctuations [6]

Supply - The operating rate of 136 independent silicon iron enterprises is reported at 30.75%, a decrease of 0.17% from the previous period [4] - The average daily output is 14,150 tons, which is an increase of 10 tons compared to the previous period, with a weekly production of 99,000 tons [4] Demand - Weekly demand for five major steel types of silicon iron is 20,560.4 tons, remaining stable compared to last week [5] - Total production of five major materials is 8.7417 million tons, a decrease of 95,200 tons from the previous period [5] - Total inventory stands at 14.7607 million tons, an increase of 289,000 tons, with social inventory at 10.3304 million tons, up by 93,500 tons [5] Costs and Profits - The overall market for Lan coal remains stable, with small material prices in the Shenmu area ranging from 605 to 690 yuan/ton [3] - The production costs for immediate production in Inner Mongolia, Qinghai, and Ningxia are 5,681 yuan/ton, 5,792 yuan/ton, and 5,460 yuan/ton respectively [3] - Immediate profits in Inner Mongolia and Ningxia are reported at -231 yuan/ton and -110 yuan/ton respectively [3] Market Overview - The main contract for silicon iron futures fluctuated, closing at 5,472 yuan/ton, an increase of 0.77% [2] - The market sentiment indicates that traders are primarily focused on replenishing stocks, with limited speculative buying interest [6] - The overall inventory remains at a medium to high level despite a slight decline in factory inventory [6] Price Trends - Current prices in major production areas are reported as follows: Inner Mongolia at 5,450 yuan/ton, Ningxia at 5,350 yuan/ton, and Qinghai at 5,450 yuan/ton, with a decrease of 100 yuan/ton in Qinghai [1] - The price of magnesium continues to rise, with mainstream cash prices for 99.90% magnesium ingots in Shaanxi around 16,700-16,800 yuan/ton [5]