The global ferrosilicon market, which was estimated at approximately US$10.2 billion in 2021, is anticipated to maintain gradual growth in the long term, propelled by the sustained demand from the steel and cast iron industries.
The steady expansion of the steel and cast iron sectors continues to drive the demand for ferrosilicon. Used as a deoxidizer in the steel industry to prevent carbon loss during manufacturing, ferrosilicon finds a critical role in enhancing steel quality. The increasing investments in the steel industry are expected to significantly contribute to the markets growth. Notably, the rising demand for galvanized steel sheets for the automotive industry is set to bolster the ferrosilicon market, as witnessed in projects like POSCOs new galvanized steel facility in Tangshan, China. The cast iron sector, known for its application in plumbing due to its durability and compressive strength, is also undergoing capacity expansions, further propelling ferrosilicon demand. For instance, American SpiralWeld Pipe Companys investment to expand its operations in the USAs Richland County showcases the growing reliance on cast iron pipes, contributing to the markets expansion.
Market Recovery Post COVID-19
The global ferrosilicon market, like many other industries, experienced challenges due to the COVID-19 pandemic. Lockdowns and supply chain disruptions impacted manufacturing activities across the board. However, as regional regulatory authorities begin to ease restrictions, the market is expected to regain its momentum. The pandemic-induced financial constraints have prompted reduced non-essential spending, impacting consumer demand. Furthermore, the temporary halt in construction activities due to lockdowns has affected the construction sectors demand for ferrosilicon. Despite these challenges, the ferrosilicon industry is anticipated to recover as the situation normalizes.
Key Drivers of Ferrosilicon Market Growth
- Steel Industry Demand: The demand for steel, driven by various sectors such as automotive, construction, and manufacturing, directly influences the need for ferrosilicon. The addition of ferrosilicon to steel improves its mechanical, chemical, and physical properties. The rise in crude steel production worldwide, coupled with the growth of the electrical steel sector, is expected to drive the demand for ferrosilicon.
- Infrastructure Programs: The expansion of infrastructure programs, including railways and buildings, in the auto industry is projected to fuel demand for ferrosilicon. As the auto industry continues to focus on creating lightweight steel for enhanced fuel efficiency, the ferrosilicon market is poised for growth.
- Emerging Alternatives: The emergence of alternatives, such as high carbon silicon, poses a challenge to the ferrosilicon market. High carbon silicon is a cost-effective alternative with similar deoxidation and silicon characteristics. Market players need to navigate this competition while maintaining their market presence.
Asia Pacific Dominance and Market Landscape
The Asia Pacific region is anticipated to lead the global ferrosilicon market due to increased steel production, ongoing investments in the automotive sector, and rapid infrastructural developments. China, India, and Japan are at the forefront of crude steel production, driving the demand for ferrosilicon in the region. Despite the challenges posed by the COVID-19 pandemic, the adoption of semiconductors in electronic devices has also contributed to the growing demand for ferrosilicon in the Asia Pacific region.
The ferrosilicon market is characterized by competitive dynamics, with numerous players striving to maintain and expand their market presence. Companies are engaged in strategic operations, including acquisitions and capacity expansions, to enhance their offerings and position in the market. For instance, Elkem ASAs acquisition of the Salten energy recovery plant aims to produce environmentally friendly ferrosilicon grade. Factors such as urbanization, industrialization, rising luxury car sales, increased building activity, and growing demand for consumer electronics contribute to the promising future of the ferrosilicon market.
Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2023-2030 By Product, Technology, Grade, Application, End-user, Region: (North America, Europe, Asia Pacific, Latin America and Middle East and Africa) https://www.fairfieldmarketresearch.com/report/ferrosilicon-market
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