Investing in ferro silicon production is an excellent way to make a profit. The market is growing and demand is high. The price is also rising, which makes it an ideal investment opportunity.
The COVID-19 pandemic caused a brief disruption in the industry, but supplies are now recovering and prices have risen. This is good news for the global metallurgy industry.
The main market for ferrosilicon is the steel industry. The addition of this mineral in the steelmaking process increases the strength, hardness, and elasticity of finished steel products. It is also a critical ingredient in the production of magnesium. Approximately 1.1 tonnes of magnesium are produced from each tonne of ferrosilicon. The price of ferrosilicon is therefore highly dependent on its use in downstream industries.
The Pidgeon process involves loading briquettes of the reactants into tubular steel retorts that are evacuated to a pressure below 0.1 torr and externally heated to a temperature in the range 1150-1200degC, usually by burning coal. Magnesium forms as a vapor that condenses on removable water-cooled sleeves at the ends of the retorts.
Traders expect output curbs in China’s key production hub of Ningxia to support domestic prices this week. Spot prices for 72pc grade in Ningxia rose to Yn7,500-7,900/t ex-works this week, up from Yn7,500/7,600/t last week following the output cuts.
Due to its lightweight nature, magnesium is a key raw material in many applications. Hence, its production has a significant impact on the environment. The traditional method involves ore reduction, which emits carbon dioxide and other toxic gases. This process also requires substantial energy.
However, as the demand for magnesium grows, companies will seek ways to reduce these emissions. This can be achieved through an alternative manufacturing process. One option is the use of a high-pressure carbonation reactor (HPCR). This technique can be used to produce magnesium and ferrosilicon in a more environmentally friendly way.
Currently, the leading exporters of magnesia ferrosilicon are China, Russia, Malaysia and Australia. Rising investments in the construction industry are expected to boost the market growth for this product. In addition, the USD 600 million plants built by AMERICAN SpiralWeld Pipe Company will fuel the consumption of this product. These plants will produce cast iron pipes, which are popular in plumbing applications.
Magnesium is the only structural metal that can be made without direct carbon dioxide emissions. This is mainly because magnesium doesn’t require oxygen for reduction, and it can be smelted at lower temperatures than aluminum electrolysis or steel production, which emits 10% of the world’s carbon dioxide.
Ferrosilicon is produced by reducing silica with coke in the presence of iron (usually derived from scrap or iron ore). The resultant product can be found as shiny, metallic-grey lumps or pre-formed briquettes. The highest quality ferrosilicon contains between 60-75% silicon and the remainder consists of iron. Low-carbon ferrosilicon is used to avoid reintroducing carbon during the manufacture of stainless steel, while low-titanium and low-aluminium ferrosilicon are used to prevent inclusion-forming oxides in electrical steel and other specialty steels.
Ferroglobe is one of the largest producers of 50% and 75% high-purity ferrosilicon, which is used to improve the strength and quality of steel. It is also used for deoxidizing, inoculating and alloying steel. The company also produces specialty silica products based on serpentine such as precipitated silica, colloidal silica, fumed silica and silica gel.
The demand for magnesium has increased significantly in recent years. As a result, the price of the metal has increased. While it has many perks, such as being lightweight, there are also environmental impacts. Producing magnesium through the Pigeon Process requires a large amount of energy, which is generated by coal and results in greenhouse gas emissions.
The resulting increase in prices has prompted some steel mills to limit their ferrosilicon purchases. For example, one Japanese steelmaker is avoiding Chinese supplies that may have been shipped through third countries without paying the 25% export tax. This is because the quality of the materials could be compromised.
Some companies have even stopped purchasing the material altogether, citing concerns about the safety of the product. However, it is important to note that the metal has many applications, including in the automotive industry and construction. The use of the metal is expected to continue to grow, despite its high cost.
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