Indian silico manganese prices have increased before the Diwali holidays as steel manufacturers look to secure raw material in advance. Many market participants also believe that the silico manganese producers have come together and increased the offers to halt the silico manganese prices from falling further.
Current assessments are at INR 59,000/t both in Raipur and Durgapur, and exports prices are also up by $10/t for 60-14 grade to $815/t and $860/t for 65-16 grade.
Meanwhile, the domestic demand has picked up in line with pre-stocking before the Diwali holidays. In addition to this, the market is facing a shortage of silico manganese as few major producers are already overbooked with the pre-existing orders.
However, despite a marginal decrease in the steel prices, the sentiment for an increase in steel prices post-festival is firm in the domestic market. Thus, positive sentiment has spread to the ferro alloys industries, with expectations of better domestic demand.
SteelMint assessed that since the inventory is low with the alloy producers, they are expected to keep offers firm before the festival.
Meanwhile, in the export market prices have also increased in line with the recent appreciation of Indian currency and firm prices of steel in major consuming nations for Indian silico manganese. In the meantime, it is expected that continuous falling manganese ore prices might have an adverse effect on the silico manganese prices.
Outlook:
Although producers have kept the prices firm, for now, it is highly dependent on how the steel market functions post-festival for the prices to remain stable. Any increase in the prices is highly unlikely as steel manufacturers have sufficient stock of silico manganese, however, a marginal drop cannot be ruled out after Diwali in the domestic market.
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