What is a ferro silicon project report?
A ferro silicon project report is a detailed project report (DPR) for a plant that smelts quartz, carbon and iron in a submerged arc furnace to make ferro silicon alloy. It sets out furnace size, power demand, raw materials, approvals, project cost, means of finance, five-year projections, DSCR and break-even for the promoter and the lender.
Promoters use it to size the furnace and raise a term loan; banks and power utilities use it to judge whether the plant can carry its electricity bill and repay.
Also known as: ferrosilicon project report, project report on ferro silicon, ferro silicon business plan, FeSi plant DPR.
Ferro silicon plant cost in India and project economics
Our sample report models a 13 MT per day plant, or 4,290 MT per year at full capacity, running 330 days a year. It starts at 60% utilisation and reaches 80% in Year 5, selling at ₹96,800 per MT ex-GST.
Plant and machinery is half the project cost: ₹671.23 lakh of a ₹1,336.43 lakh project. The furnace and transformer quotations therefore move the whole report.
| Land and site development | 119.55 |
|---|---|
| Building and civil works | 297.29 |
| Plant and machinery | 671.23 |
| Other fixed assets | 67.66 |
| Contingencies | 48.43 |
| Preliminary and pre-operative | 30.10 |
| Working capital margin | 102.17 |
| Total | 1,336.43 |
| Promoter's contribution (25%) | 334.11 |
|---|---|
| Term loan from bank (75%) | 1,002.32 |
| Cash credit limit (separate) | 306.50 |
| Total project cost | 1,336.43 |
Term loan at 10.5% with a 6-month moratorium and 54 monthly instalments; lowest DSCR 1.41. All figures are illustrative.
Ferro silicon manufacturing process
Ferro silicon is made by carbothermic reduction: carbon strips oxygen from silica at very high temperature, and the silicon dissolves into iron. The furnace runs round the clock, so the steps below repeat in a continuous cycle.
- Preparing the charge
Quartz is washed to remove clay and sized into lumps, then weighed with coke, coal and iron scrap into a fixed recipe for the grade.
- Charging the furnace
The mix is fed from day bins around three Soderberg electrodes, keeping the charge porous so gases can escape evenly.
- Smelting
Electric arcs heat the bottom of the furnace to roughly 1,800 °C, where carbon reduces silica and the silicon alloys with iron.
- Tapping
Every few hours the tap hole is opened and molten alloy runs into a ladle; the hole is then sealed with clay.
- Casting and cooling
The ladle is poured into flat cast iron moulds lined with alloy fines, which keeps the cake thin and easy to break.
- Crushing, sizing and packing
Cooled cakes are crushed and screened to the lump sizes buyers specify, and fines are kept apart for remelting or sale.
Choosing the furnace size and ferro silicon grade
Two early choices set the cost of the plant: how many MVA the furnace draws and which grade it makes. Public environmental clearance filings give a useful reference for smaller plants.
| Furnace type | Three-phase submerged arc furnace with self-baking Soderberg electrodes, run continuously |
|---|---|
| Small plant reference | A 1 x 5 MVA furnace filed for 5,000 tonnes a year of ferro silicon, at a project cost of ₹1,575 lakh |
| Larger plant reference | A 2 x 6 MVA plant filed for 7,750 tonnes a year of ferro silicon, at a project cost of ₹27 crore |
| Grades | Common grades are 65%, 70% and 75% silicon for steelmaking, with low-aluminium and sized grades for foundries |
| Product flexibility | The same furnace can be approved to make silico manganese or ferro manganese, one product at a time |
| By-products | Slag, sold to cupola users, and bag filter dust, which is agglomerated and recycled or sold |
Plant references are from clearance documents for two Maharashtra plants. Our 13 MT per day sample sits close to the 5 MVA reference.
Raw materials for ferro silicon
Quartz quality decides both recovery and grade. Lumps high in alumina or iron oxide add slag and pull the silicon content down, so plants test every lot before it reaches the day bins.
Our sample books smelting power with raw materials, because it is consumed per tonne of alloy like quartz and coke. That makes power the largest item at 42%, with quartz next at 24%.
| Input | Share of cost | Year 3 (₹ lakh) |
|---|---|---|
| Quartz | 24% | 418.28 |
| Coke and coal | 22% | 383.42 |
| Iron scrap or mill scale | 7% | 122.00 |
| Electrode paste | 5% | 87.14 |
| Smelting power | 42% | 731.99 |
| Total | 100% | 1,742.83 |
Clearance filings show about 1.0–1.8 tonnes of quartz per tonne of alloy, depending on grade and charge design.
Machinery for a ferro silicon plant
The submerged arc furnace is the largest single item, followed by the furnace transformer. Fume extraction is a major cost too, because the off-gas carries fine silica dust that must be caught.
| Equipment | What it does | Sample cost (₹ lakh) |
|---|---|---|
| Submerged arc furnace with Soderberg electrodes | Smelts the charge with electric arcs | 281.92 |
| Furnace transformer and HT switchyard | Steps down grid power to furnace voltage | 134.24 |
| Fume extraction and bag filter | Captures furnace dust and fumes | 80.55 |
| Raw material handling and batching | Stores, weighs and feeds the charge | 67.12 |
| Ladles, moulds and casting bay crane | Carries and casts the molten alloy | 60.41 |
| Crushing and screening | Breaks cakes into buyer sizes | 46.99 |
| Total plant and machinery | 671.23 | |
Costs are the sample report's estimates for a 13 MT per day plant. Get current quotations before you finalise.
Power, water and land for a ferro silicon plant
Power is the input that makes or breaks the project. Lenders look first at the tariff, the supply agreement and how often the grid trips in the chosen area.
| Power per tonne | Indicative 8,500–10,000 kWh per tonne of 70–75% grade |
|---|---|
| Annual demand | A 5 MVA plant was filed at about 40,000 MWh a year on a 33 kV supply |
| Water | 17–30 KLD in the two filings, mostly furnace and transformer cooling in a closed loop with zero discharge |
| Land | About 2 hectares for a 2 x 6 MVA plant, with a third kept as green belt |
| Backup | A small DG set (100 kVA in one filing) for emergency loads during grid failure, not for smelting |
Why the tariff matters: in our sample, smelting power alone is ₹731.99 lakh in Year 3. Because power is costed per tonne, every change in the tariff flows straight into profit and DSCR.
Licences, BIS and environmental clearance
A ferro silicon plant needs more approvals than most small units. Start the clearance and BIS work early, because they set the date the furnace can be lit.
| BIS certification | Mandatory under the Quality Control Order for IS 1110:2023, in force since 23 October 2022 |
|---|---|
| Environmental clearance | Prior clearance under item 3(a), metallurgical industries, of the EIA Notification 2006; a site in a critically polluted area was placed in Category A |
| Pollution board consent | Consent to establish and operate from the State Pollution Control Board, with stack monitoring linked to the board |
| Power | HT connection, power purchase terms and electrical inspectorate approval for the transformer |
| Business registration | Udyam (MSME) and GST registration, and a factory licence under the Factories Act |
Rules differ by state and change over time. Confirm current terms with the board, BIS and the power utility before you apply.
Who buys ferro silicon in India
Most ferro silicon goes into steel. Melting shops add it to remove oxygen from liquid steel, and stainless and electrical steel makers use it to raise silicon content. Foundries add smaller, sized grades to cast iron to control graphite.
Much of India's domestic output comes from plants in Meghalaya, Assam and Arunachal Pradesh, and Bhutan is the largest source of imports. Prices in eastern India therefore move with Bhutan offers and northeastern power supply.
- Induction furnace and steel melting shops
- Integrated, stainless and electrical steel plants
- Grey and ductile iron foundries
- Magnesium ferro silicon and inoculant makers
- Ferro alloy traders and exporters
Where a new plant wins: buyers pay for consistent silicon and low aluminium. A plant that controls quartz quality and sizes lumps to order can hold foundry customers who reject variable lots.
Mistakes that weaken a ferro silicon project report
- Using a tariff the plant cannot get
A report built on a concessional or old tariff overstates profit. Lenders ask for the utility's current HT rate and any surcharge.
- Assuming full silicon recovery
Part of the silicon leaves as fume and slag. Output must be worked out from realistic recovery, not from the silica charged.
- Leaving out BIS and clearance time
A furnace cannot sell legally until the BIS licence and consents are in place. Delays raise interest during construction.
- No plan for dust and slag
Bag filter dust and slag pile up every day. The report should show how each is recycled or sold, and at what value.
- Ignoring import parity
Selling prices above landed Bhutan or overseas offers do not hold. Test the projections at the lower price band.
How NPCS helps you plan a ferro silicon plant
- Furnace size and product mixMatch MVA rating, grade and any silico manganese option to your power and market.
- Power and site studyCompare tariffs, supply reliability and quartz and coke freight for shortlisted states.
- Bank-ready project reportProjections, DSCR, sensitivity to tariff and price, and working capital in your lender's format.
- Approvals roadmapSequence for environmental clearance, pollution consent, BIS licence and HT connection.
NPCS's published client list includes 116 metal products assignments, among them ferro silicon. The NPCS project team, led by founder Ajay Kumar Gupta, has prepared industrial project reports since 1994.
What's inside the ferro silicon sample report
- Introduction
- Uses and applications
- Market potential
- Manufacturing process
- Raw materials
- Plant and machinery
- Land, building and utilities
- Manpower
- Licences and approvals
- Project cost and means of finance
- Working capital
- Projected profitability
- Cash flow statement
- Projected balance sheet
- Depreciation
- Term loan repayment
- Debt service coverage
- Break-even analysis
- Financial ratios
- Key assumptions
- Conclusion
- Monthly loan repayment schedule
18 pages, five-year projections, illustrative figures.
Open sample reportFree sample or a report for your project?
| What you get | Free sample | NPCS report for your project |
|---|---|---|
| Capacity and location | Typical unit | Your capacity, site and state |
| Figures | Illustrative | Built on current prices and quotations |
| Machinery suppliers and quotations | No | Yes |
| Market survey for your region | No | Yes |
| Bank or scheme format (PMEGP, term loan) | No | Yes |
| Use for a loan application | No | Yes |
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Ferro Silicon project report: frequently asked questions
How much does it cost to set up a ferro silicon plant in India?
Our sample report models a 13 MT per day plant at ₹1,336 lakh, including land, building, a submerged arc furnace and working capital margin. Environmental clearance filings show a 5 MVA plant at about ₹15.75 crore and a 2 x 6 MVA plant at ₹27 crore. Treat these as indicative; your report prices the furnace, transformer and site you choose.
How much electricity does it take to make one tonne of ferro silicon?
Ferro silicon is one of the most power-hungry alloys. An indicative figure is about 8,500–10,000 kWh per tonne of 70–75% grade, depending on furnace size, quartz quality and how well the charge is run. That is why plants are built where the industrial tariff is lowest and the supply is steady.
What raw materials are used to make ferro silicon?
Quartz or quartzite supplies the silicon, coke and coal act as the reducing agent, and iron scrap or mill scale supplies the iron. Electrode paste feeds the self-baking Soderberg electrodes. Clearance filings for Maharashtra plants show roughly 1.0–1.8 tonnes of quartz per tonne of alloy, varying with the grade made.
Is BIS certification mandatory for ferro silicon?
Yes. Ferrosilicon is covered by IS 1110:2023, and the BIS standards portal shows a Quality Control Order with mandatory certification in force from 23 October 2022. A plant needs a BIS licence before it sells ferro silicon in India, so the in-house laboratory and sampling plan should be part of the project cost.
Is a ferro silicon plant profitable?
In our illustrative sample, the plant earns an 18% return on investment in Year 3, breaks even at 43% of capacity and pays back in about 4 years. Real profit depends mostly on the power tariff, silicon recovery in the furnace, quartz quality and how the domestic price compares with imports from Bhutan.
Can one furnace make ferro silicon and other ferro alloys?
Often, yes. Several submerged arc furnace plants in India hold approvals to make ferro silicon, silico manganese or ferro manganese, one at a time. Switching products changes the charge, power use per tonne and output, so the project report should model the product mix you will actually run.
Is the sample report free and can I use it for a bank loan?
The sample is free to view and download. It is an illustrative report that shows the format and depth of an NPCS report. Its figures are representative and not based on a real project, so do not submit it to a bank. For a loan, NPCS prepares a report for your own furnace size, site and power tariff.
Sources and references
- IS 1110:2023 Ferrosilicon: Specification (Quality Control Order details)Bureau of Indian Standards, checked Oct 2026
- Pre-feasibility report, 1 x 5 MVA submerged arc furnace for ferro alloys, MIDC ChandrapurMinistry of Environment, Forest and Climate Change (environmental clearance portal), checked Oct 2026
- Executive summary, 2 x 6 MVA ferro alloys plant, Umred MIDCMaharashtra Pollution Control Board, checked Oct 2026
The NPCS project team, led by Ajay Kumar Gupta
This page and its sample report are prepared and reviewed by the NPCS project team, which has written techno-economic feasibility studies and detailed project reports since 1994.
Ajay Kumar Gupta founded Niir Project Consultancy Services (NPCS) and leads the organisation. With 40 years of experience in MSME project consulting, he has built the team that has delivered more than 28,000 project reports for clients worldwide, helping entrepreneurs plan and finance profitable manufacturing businesses.
- Published
- Last updated
- Next review
- Oct 2027
- Reviewed by
- NPCS project team
This page is reviewed every 12 months, or sooner when scheme limits, GST rates, BIS rules or pollution categories change. The sample report is illustrative: its figures are generated from industry-typical ratios for a unit of this size, checked so every statement balances, and are not taken from any client project.