Indian industries are shelling out more for the raw material because supply from China has declined
The price of ferrosilicon in the Indian market has picked up recently. It has increased from Nu 70,000 to Nu 81,000 per Metric Ton (MT) since this week.
The prime reason, according to some industrialists, is that Indian industries using ferrosilicon as raw material are facing shortage as imports from China have declined.
China has been a major exporter of ferrosilicon to the Indian market compared to other countries. Bhutanese ferrosilicon has now become a product in demand by the Indian industries. The price is determined by the global market and not by GST.
The increase in prices up to Nu 11,000 per MT is a huge relief for Bhutanese ferrosilicon industries after battling hurdles post July due to Goods and Service sTax (GST) imposition in India that caused exports to be halted for days hampering the companies’ revenue generation.
Pelden Enterprise, a ferrosilicon industry in Pasakha Industrial Estate received a purchase order on Tuesday. The Indian company buying from them is offering Nu 81,000 per MT compared to an earlier Nu 69,500 per MT.
However, prices for third countries still remain the same. Prices with third countries are fixed three months before product delivery and shipping is required.
Bhutanese industries also export to the Netherlands and Malaysia through the parties. “The price of ferrosilicon has increased due to increased demand in Indian industries,” Dorji Phuntsho, Pelden Enterprise’s Director said.
Ferrosilicon is used as raw material for steel industries in India, which is the main market for Bhutanese ferrosilicon.While up to 70% of Bhutanese ferrosilicon is exported to India, the rest is shipped to European countries and Malaysia
Bhutanese ferrosilicon industries consider the price rise a win-win situation for both the parties: Indian ferrosilicon industries who are having raw material shortage in India and the Bhutanese industries who are struggling to export.
Niladri Bose, Marketing Manager of Pelden Enterprise said that chances of prices rising higher exist. “We expect further increase from November,” he said.
Ferrosilicon is used to manufacture silicon, corrosion-resistant and high temperature resistant ferrous silicon alloys and silicon steel for electro motors and transformer cores. It is also used in the manufacture of cast iron and inoculation of iron to accelerate graphitization.
However, other ferrosilicon companies are yet to receive supply orders after the news on price rise. Ugyen Ferro Alloys Limited (UFAL) has not received any orders with the increased price. Manish Sharma, UFAL’s Marketing Manager said that the company is aware of the news but has not received any demand. “We have heard about it but are waiting for orders to confirm,” he said. However, the suppliers are still reluctant to place orders due to obstacles in Jaigaon’s Land Customs Office where the processes to complete GST formalities have slowed down.
Meanwhile, other companies denied information citing that they do not share information on prices.
Krishna Ghalley from Phuentsholing