Ferrosilicon Market: Market Trends and Insights in the Ferrosilicon Sector

The Ferrosilicon Market size was valued at USD 11.79 Bn in 2023 and is expected to reach USD 14.01 Bn by 2029, at a CAGR of 2.5%

Ferrosilicon is a critical alloying agent used in steel production, and the growing demand for steel is a major driver of the Ferrosilicon market. Steel is used in a wide range of industries, including construction, automotive, and manufacturing. As these industries continue to grow, so does the demand for steel, which in turn drives the demand for Ferrosilicon.

Ferrosilicon is an alloy of iron and silicon, typically containing a silicon content of 15–90% by weight. It is a silvery-gray, brittle material with a high melting point of around 1,200 degrees Celsius. Ferrosilicon is an important industrial material used in a variety of applications, including Steel production, Smelting, Chemical production.
The global ferrosilicon market is poised for robust growth, fueled by the increasing utilization of ferrosilicon as a deoxidizer in the steel industry and as an inoculant in cast iron production. The rapidly increasing demand for steel is prompting manufacturers to enhance their production capabilities. Case in point, AM/NS India entered into a Memorandum of Understanding (MoU) with the Gujarat government in January 2022, committing an investment of over USD 22.0 billion in six projects across the state. This investment includes USD 5.97 billion earmarked for expanding steel production at the Hazira plant from 8.6 to 18.0 million tons per annum.To know about the Research Methodology :- Request Free Sample Report
Ferrosilicon Market Dynamics
The United States stands as a prominent figure in the global steel production landscape, consistently holding a top position among global steel producers. The Ferrosilicon Market within the United States has witnessed notable growth over the years, mirroring the country's steel production trends. In 2021, the U.S. steel industry experienced a remarkable surge, with production output reaching an impressive 86.0 million tons, marking an 18.3% increase compared to 2020. This robust growth was fueled by a significant rise in investments directed towards infrastructure development projects, which in turn stimulated the Ferrosilicon Market within the country.

A notable example of this trend is the Infrastructure and Jobs Act signed by the U.S. President in 2021. This landmark legislation allocated a substantial USD 550 billion for enhancing the nation's infrastructure, encompassing roads, airports, ports, and freight rails. This massive investment in infrastructure projects propelled the demand for steel and consequently the Ferrosilicon Market in the United States. Despite the robust performance in 2021, the U.S. steel industry, including the Ferrosilicon Market, experienced a setback in 2022 with production declining by 5.9%. This downturn can be attributed to a combination of factors, including supply chain disruptions, rising energy costs, and a slowdown in economic growth.The supply chain disruptions caused by the COVID-19 pandemic and global logistics challenges significantly impacted the Ferrosilicon Market, hindering the availability of raw materials and increasing transportation costs. The surge in energy prices, mainly for natural gas, a crucial input for steel production, further exacerbated the challenges faced by the Ferrosilicon Market. Moreover, the slowdown in economic growth, particularly in the construction and manufacturing sectors, contributed to the decline in steel demand and consequently the Ferrosilicon Market. The Ferrosilicon Market is closely tied to the steel industry, and any fluctuations in steel demand directly impact the market for Ferrosilicon.

Despite the recent challenges, the long-term outlook for the Ferrosilicon Market in the United States remains positive. The country's infrastructure needs remain extensive, and ongoing investments in infrastructure projects are expected to revive steel demand and consequently the Ferrosilicon Market. Furthermore, the growing emphasis on sustainability and the development of environmentally friendly steel production technologies are expected to boost the demand for high-quality Ferrosilicon, creating new opportunities for the Ferrosilicon Market in the United States.

The Ferrosilicon Market is experiencing escalating competition spurred by the surge in infrastructure investments. This surge has driven market players to engage in mergers and acquisitions (M&A) and capacity expansions to strengthen their competitive positioning. A notable example is the acquisition of ArcelorMittal USA and its subsidiaries by Cleveland-Cliffs Inc. in December 2020. The integration of these acquired assets with existing facilities is expected to transform Cleveland-Cliffs Inc. into a vertically integrated producer of iron and steel, thereby influencing the Ferrosilicon Market dynamics. Moreover, the burgeoning growth in the electric vehicles (EVs) industry is positively impacting the Ferrosilicon Market trajectory. In November 2021, POSCO announced a significant investment of KRW 1 trillion (~USD 831.4 million) to establish a non-oriented electrical steel plant with an annual production capacity of 300 kilotons in Gwangyang. This new plant primarily cater to the drive motors of EVs, consequently driving the demand for Ferrosilicon.Similarly, in September 2021, NLMK commissioned a new electrical steel laser treatment unit with an anticipated capacity of 54 kilotons per year. Additionally, the company is constructing an electrical steel plant in India with an annual capacity of 64 kilotons. Ferrosilicon is a critical component in electrical steel production, and these investments are expected to propel the Ferrosilicon Market growth throughout the forecast period. These developments highlight the intensifying competition and growing demand in the Ferrosilicon Market, paving the way for a dynamic and evolving market landscape. The Ferrosilicon Market participants will need to strategically adapt to these trends to capitalize on the emerging opportunities and maintain their competitive edge.
Ferrosilicon Market Segment Analysis
The Ferrosilicon Market is shaped by the diverse end-use applications of ferrosilicon, with each segment presenting unique growth opportunities. In 2022, carbon and other alloy steel held a commanding revenue share of over 43.0%, showcasing its dominance in the Ferrosilicon Market. Ferrosilicon plays an indispensable role in steel production, functioning as a critical deoxidizer and alloying agent. Furthermore, ferrosilicon powder's distinct properties make it a valuable heat-producing agent for capped steel manufacturing.

Within the Ferrosilicon Market, cast iron is expected to witness the highest revenue growth rate during the forecast period. This expected growth stems from cast iron's inherent advantages, including its lower cost, ease of melting, and superior casting properties compared to steel. Ferrosilicon serves as an inoculant in the cast iron industry, effectively preventing iron carbide formation caused by rapid cooling in thin sections of castings. The burgeoning investments in cast iron production are expected to drive the demand for ferrosilicon in this end-use segment during the forecast period.

Stainless steel represents another prominent end-use segment of the Ferrosilicon Market. Ferrosilicon is extensively used in stainless steel production to enhance its aesthetic appeal, wear resistance, and corrosion resistance. This has led to a surge in stainless steel production, further propelling the growth of the Ferrosilicon Market in this segment. A notable example is the announcement by Jindal Stainless Ltd. in December 2021, where the company secured USD 82 million from KfW IPEX-Bank to expand its production facilities in India. This facility expansion is expected to increase annual production from 1.1 to 2.1 million tons, contributing to the growth of the Ferrosilicon Market in the stainless-steel end-use segment. These developments highlight the dynamic nature of the Ferrosilicon Market, driven by the diverse end-use applications of ferrosilicon. Market participants will need to carefully consider these end-use trends to strategize effectively and capture emerging opportunities in the Ferrosilicon Market.

The Ferrosilicon Market landscape is shaped by the diverse application segments it caters to. In 2022, deoxidizers held a commanding revenue share of over 69.0%, highlighting their dominance within the Ferrosilicon Market. Ferrosilicon is extensively utilized as a deoxidizer in the steel industry. The deoxidization process effectively blocks heat and prevents carbon loss from the molten steel, ensuring its superior quality and integrity. This underscores the crucial role of ferrosilicon in the steelmaking process and its subsequent impact on the Ferrosilicon Market. Among the various application segments, inoculants are poised to register the highest revenue growth rate during the forecast period. Ferrosilicon serves as an essential inoculant in the cast iron industry, and the burgeoning demand for cast iron cookware is expected to further propel the Ferrosilicon Market in this segment.

A notable example is the USD 1.1 million funding secured by The Indus Valley, a direct-to-consumer cast iron kitchenware producer, in October 2021. This investment from RU.K.am Capital, DSG Consumer Partners, and The Chennai Angels is intended to expand production and deliver toxin-free kitchenware products, contributing to the growth of the Ferrosilicon Market in the inoculants segment. These developments underscore the dynamic nature of the Ferrosilicon Market, driven by the diverse application areas of ferrosilicon. Market participants will need to carefully consider these application trends to strategize effectively and capture emerging opportunities in the Ferrosilicon Market.

By aligning their strategies with the evolving application landscape, market players can position themselves for continued success in this dynamic market. In addition to its utilization in various steelmaking processes, ferrosilicon also plays a crucial role in the Pidgeon process, a refined method for extracting high-purity magnesium from dolomite. The burgeoning demand for magnesium products across various industries, including automotive, aerospace, and construction, is driving the growth of the magnesium production, thereby positively impacting the ferrosilicon market. This growing demand is evident in investments like the one made by LiteAuto in December 2021, where the company committed INR 1,500 crore (~USD 199.3 million) to establish a magnesium production facility in Telangana, India, specifically catering to the automotive industry.
Ferrosilicon Market Regional Insights:
The Ferrosilicon Market landscape is dominated by the Asia Pacific region, which held a commanding revenue share of over 66.0% in 2022. This region's robust growth can be attributed to its high potential for infrastructural developments and continuous investments in the automobile industry. These factors are propelling steel production, which in turn, is augmenting the growth of the Ferrosilicon Market in the region. According to the World Steel Association, China, India, and Japan were the top three crude steel producers globally in 2021. While China and Japan experienced a decline in their production, India reported an impressive 4.7% increase from 2020 to 2021. The region is witnessing a surge in investments in steel capacity expansions across various countries, which is anticipated to further fuel the Ferrosilicon Market in the region during the forecast period.

This expansion in steel production capacity is expected to drive the demand for ferrosilicon, a crucial input in steelmaking, thereby propelling the Ferrosilicon Market in the Asia Pacific region. Moreover, the growing presence of major steel producers in the region, such as ArcelorMittal Nippon Steel India and POSCO India, is further contributing to the growth of the Ferrosilicon Market in Asia Pacific.

North America is projected to register a notable CAGR of 2.2%, in terms of revenue, over the forecast period. The growth of the EV industry coupled with rising construction spending is anticipated to propel the Ferrosilicon Market in the region during the forecast period. A notable example is the 96% surge in North America's EV sales from 2020 to 2021, reaching an impressive 735,000 units. This growth in EV sales is fueling the demand for ferrosilicon grade-electric steel, a critical component for producing motors used in EVs. As a result, the Ferrosilicon Market in North America is expected to benefit from the expansion of the EV industry in the region.

In Europe, EV sales witnessed a remarkable 66% increase, reaching 2,332,000 units in 2021. These soaring sales are encouraging manufacturers to expand EV production, which in turn is expected to drive the Ferrosilicon Market. The rising demand for EVs is expected to facilitate market growth as ferrosilicon grade-electric steel is a critical component for producing motors used in EVs. The expanding EV industry in Europe is expected to generate a significant demand for ferrosilicon, mainly ferrosilicon grade-electric steel. This, in turn, is expected to propel the Ferrosilicon Market in the European region during the forecast period. These developments highlight the dynamic nature of the Ferrosilicon Market, driven by the evolving steel industry trends and the growing demand for EVs across various regions. Market participants will need to carefully consider these regional trends to strategize effectively and capture emerging opportunities in the Ferrosilicon Market.

The global ferrosilicon market is characterized by intense competition among numerous players vying for market share. To gain a competitive edge, key players in the industry are actively pursuing strategic initiatives such as capacity expansions and mergers & acquisitions. A notable example is the proposal made by BMML, a ferrosilicon producer in Bhutan, in November 2021 to establish a ferrosilicon plant at Chengmari. This project, valued at over USD 11.96 million, exemplifies the proactive measures being taken by market players to expand their presence in the ferrosilicon industry.
Ferrosilicon Market Scope: Inquiry Before Buying



Ferrosilicon Market


Report Coverage
Details


Base Year:
2023
Forecast Period:
2024-2030


Historical Data:
2018 to 2023
Market Size in 2023:
US $ 11.79 Bn.


Forecast Period 2024 to 2030 CAGR:
2.5%
Market Size in 2030:
US $ 14.01 Bn.


 Segments Covered:
by Application
Beta-blockers
Deoxidizer
Inoculants
Electric Steel


by End User
Carbon & Other Alloy Steel
Stainless Steel
Electric Steel
Cast Iron
Others



Ferrosilicon Market, by Regions
North America (United States, Canada and Mexico)
Europe (UK, France, Germany, Italy, Spain, Sweden, Austria and Rest of Europe)
Asia Pacific (China, South Korea, Japan, India, Australia, Indonesia, Malaysia, and Rest of APAC)
Middle East and Africa (South Africa, GCC, Egypt, Nigeria and Rest of ME&A)
South America (Brazil, Argentina Rest of South America)
Ferrosilicon Key Players include:
North America:
1. Elkem
2. Globe Specialty Metals
3. Mississippi Silicon
4. Ferroglobe
5. Simcoa Operations Pty Ltd
6. American Elements
7. Reade International Corp.
8. Finnfjord AS

Asia Pacific:
1. Sinosteel Jilin Ferroalloy Corporation
2. China National BlueStar (Group) Co., Ltd.
3. Sinosteel Maanshan Institute of Mining Research Co., Ltd.
4. Zhejiang Hengshun Alloy Materials Co., Ltd.
5. Ferro Alloys Corporation Limited (FACOR)
6. Indian Metals and Ferro Alloys Limited (IMFA)
7. Sarawak Aluminium Company Sdn Bhd (SALCO)
8. Maithan Alloys Ltd

Europe:
1. OFZ, a.s.
2. Huta Laziska S.A.
3. FerroAtlántica (part of Grupo FerroAtlántica)
4. Visa Steel
5. S.C. Feral S.A.
6. Georgian American Alloys, Inc.

Middle East and Africa (MEA):
1. Exxaro
2. DMS Powders
3. Huta Laziska S.A.
4. Cometal S.A.
5. Silicon Smelters (Pty) Ltd
6. Transalloys (Pty) Ltd
7. Harsco Metals Poland S.A.
8. Eramet SA
9. Assmang Limited

South America:
1. Villares Metals S.A.
2. ERG Brazil
Frequently Asked Questions
1: What is ferrosilicon, and what are its primary applications?
Ans: Ferrosilicon is an alloy of iron and silicon, typically containing 15–90% silicon by weight. It is used in various applications, including steel production, smelting, and chemical production. Its key roles include serving as a deoxidizer in the steel industry and as an inoculant in cast iron production.

2: What factors are driving the growth of the global ferrosilicon market?
Ans: The global ferrosilicon market is experiencing robust growth due to increasing demand for steel, particularly as a result of infrastructure development projects. Investments in steel production, such as AM/NS India's commitment to invest over USD 22.0 billion, contribute to the market's positive outlook.

3: How did the U.S. steel industry impact the Ferrosilicon Market in 2021 and 2022?
Ans: The U.S. steel industry, a significant player in the global market, experienced notable growth in 2021, driven by infrastructure development projects. However, in 2022, the industry faced challenges such as supply chain disruptions, rising energy costs, and economic slowdown, leading to a 5.9% decline in production.

4: What challenges did the Ferrosilicon Market face in 2022, and how did they impact the industry?
Ans: Challenges in 2022 included supply chain disruptions due to the COVID-19 pandemic, global logistics challenges, rising energy prices (particularly for natural gas), and a slowdown in economic growth. These factors hindered raw material availability, increased transportation costs, and contributed to a decline in steel demand and the Ferrosilicon Market.

6: How is the Ferrosilicon Market responding to competition and growth opportunities, especially in the context of infrastructure investments and the electric vehicles (EVs) industry?
Ans: The Ferrosilicon Market is witnessing escalating competition driven by infrastructure investments. Market players are engaging in mergers, acquisitions, and capacity expansions to strengthen their positions. Additionally, the growth in the EV industry is positively impacting the market, with investments in electrical steel plants and a surge in demand for ferrosilicon grade-electric steel. These dynamics indicate a dynamic and evolving market landscape.