As the end of the month is nearer, the industry is eyeing on a new round of steel mill tenders, in strong wait-and-see mood, thus the silico manganese market is not volatile. The mainstream quotation is still prevailing at around RMB 8,500/MT. In addition, the alloy index shows that the price of silico manganese 65/17 is not much different
from the previous trading day. Specifically, the price in Henan, Hebei, Shandong, Jiangsu and other places is RMB 8,635-8,909 / MT (delivered, cash including tax.)
Supply and demand determine the price, and the biggest supporting factor for the current silico manganese alloy market is still the tight supply. Among them, manufacturers in Inner Mongolia have indicated that there is no spot availability given that they are in the middle of executing pending orders. In addition, due to insufficient output, the main producing area – Wumen has been required to increase the power limit from the beginning of last week. The power cut policy will be implemented until the end of the year. The power shortage may aggravate the spot shortage of silico manganese in the region. Ningxia has some stocks compared with Inner Mongolia, but the manufacturers have sufficient orders and there are not many resources available for retail; as for Guangxi, most large factories also have indicated that no stock is available. In a market with tight spot supply and expectation of a new round of tenders to start, the industry’s overall willingness to back up price is still strong in the anticipation of more demand release. At present, some steel mills have started to purchase silico manganese for December. Among them, Nanjing Steel plans to purchase 8,000 tonnes of silico manganese in December, which is 500 tonnes more than the number of last month. However, under the influence of the plummeted steel price and the poor futures performance, some have changed their outlook towards weakness though there is no major fluctuation on the whole.
Recently, the market of silico manganese 60/14 has continued to run smoothly, without much change and the manufacturers’ quotations also remained stable. Among them, the quotations of major manufacturers in Guangxi, Guizhou and Hunan are still prevailing at RMB 6,600-6,700 / MT,ex-factory, cash, excluding tax. (The actual transaction rate is around RMB 6,600 / MT).
Futures market:
Silico manganese contract 1901 opened at low position after opening and went down soon to touch its lower limit. Opening at 8,348, the highest at 8,374, the lowest at 7,940, closing at 7,940, and settlement at 8,068, a decrease of 6.01% (508 points). The number of positions is 183,554 lots, and the volume of transactions increased by a certain amount compared with the previous trading day, while the number of positions increased by 6,594 lots.
Manganese Ore:
CML announced its December shipment price of manganese ore to China, with Mn 46% and Fe 6% Australian lump at USD 7.65/dmtu, up USD 0.05 /dmtu from the previous month’s offer price. South32 also announced the price of manganese ore to China for December shipment, which is at USD 7.55 /dmtu for Mn 45.5% Australian lump, unchanged from last month.
Future Outlook:
Based on the assessment of various factors, it is necessary to pay close attention to the new round of tenders of silico manganese to ascertain the future market direction. However, most market participants believe caution in operation is recommended for the short-term.
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