News
04/04/25
Silicon, ferro-silicon hit by US tariffs
London, 4 April (Argus) — Silicon and ferro-silicon prices in the US are likely
to surge because of steep tariffs on imports announced this week, while prices
in Europe might fall as countries hit by high tariffs redirect material to the
EU. The tariffs announced by President Donald Trump on 2 April exempted a number
of minor metals and ferro-alloys, listed in Annex II of the executive order, but
ferro-silicon and silicon metal of less than 99.99pc purity were not among the
exemptions. The US steel industry is a major consumer of imported silicon
products. The tariffs are the second major US trade announcement on
ferro-silicon in two weeks after the International Trade Administration (ITA)
determined anti-dumping duty rates against ferro-silicon imports from Brazil,
Malaysia and Kazakhstan on 25 March. A final decision on anti-dumping duties is
due on 12 May, and it remains to be seen how the new tariffs will impact the
ITA's decision. Several major silicon and ferro-silicon producing countries are
now subject to Trump's adjusted reciprocal tariffs, above the 10pc applied to
all imports. Vietnam now has one of the highest tariff burdens at 46pc,
Kazakhstan is subject to 27pc and Malaysia to 24pc. The countries have been
major suppliers of silicon products to the US. In 2024, the US imported 27,084t
of ferro-silicon from Malaysia, 13,119t from Vietnam and 10,262t from
Kazakhstan. Silicon and ferro-silicon producer Ferroglobe, which has operations
in the US, Canada and Europe, and which petitioned for the anti-dumping duties
before the ITA, says it is too early to predict the full impact of the tariffs.
"As a vertically integrated local producer in both the US and the EU, we believe
that Ferroglobe will benefit from a more level playing field in both markets,"
the producer said. But sellers of heavily-tariffed material have taken immediate
steps to reduce their exposure. "I just cancelled a lot of vessels from Vietnam
because you cannot pay a 46pc tariff," a trader said on Thursday. Countries with
lower tariffs stand to benefit if prices surge. A producer in one such country
told Argus he expects his company's margins and market share in the US to
increase. Brazil is subject to only a 10pc tariff, making Brazilian producers
now among the most affordable for the US market. The US imported 59,971t of
silicon metal and 33,182t of ferro-silicon from Brazil in 2024, comprising 40pc
and 21pc of total silicon and ferro-silicon imports, respectively. Iceland is
also subject to the base 10pc tariff, although for silicon metal there is a
pre-existing anti-dumping duty on PCC BakkiSilicon at 47.54pc, and 37.83pc on
all other sales from Iceland. Norway's tariff was set at 16pc, making it more
competitive than the EU, which is subject to 20pc. The US imported 9pc of its
silicon metal from Norway in 2024. Norwegian silicon and ferro-silicon producer
Elkem, which exports silicon-based products to the US from Canada, Paraguay,
Iceland and Norway, told Argus the company will be increasing prices on all
products going to the US. "Given that the US is a net importer of our products,
we expect prices in the US to increase by more than the raised tariffs on
Elkem's products," the company said. US exports might be redirected to EU The
European ferro-silicon market has been rattled by concerns of dumping in Europe.
Many expect more affordable material from Kazakhstan, Vietnam and Malaysia to
flood the European market because of trade diversions from the US. A European
producer expects large quantities of ferro-silicon to flood the market. "I am
very afraid that Kazakhstan especially can ship material to Europe and will take
the risk," he said. The EU has said it will take steps to prevent dumping of
cheap goods in Europe. But with the European steel industry under pressure from
the tariffs, the EU might hesitate to take measures that could increase costs
for the steel sector. EU safeguard investigation could face delays The European
ferro-silicon and silicon industries have already struggled to compete with
affordable imports from third-country competitors with lower production costs.
On 19 December, the European Commission announced a safeguard investigation on
imports of silicon, ferro-silicon and manganese alloys. Many market participants
expected a decision on trade protection measures in April. Some traders have
held on to stock in the hope of prices increasing after the announcement. But
now producers, traders and consumers told Argus this week that they expect any
decision on safeguarding the ferro-alloy industry to be delayed until tariff
negotiations have been concluded. Some planned meetings on the measures have
been cancelled, the producer heard, as priorities have shifted. A trader with
stocks in Europe told Argus that if he hears confirmation that the safeguard
announcement will be delayed, he and other traders will look to sell material.
"Prices are only inflamed because of the safeguarding," the trader said. "If
it's a six-month delay, prices might stay firm, but if it's a year, we can't
wait." By Maeve Flaherty Additional reporting from Samuel Wood Send comments and
request more information at feedback@argusmedia.com Copyright © 2025. Argus
Media group . All rights reserved.
