India: Silico manganese prices down marginally amid modest demand

India’s silico manganese prices fell marginally amid modest domestic demand due to weak steel sentiments. Buyers resisted to procure at the current levels, resulting in low inquiries in both domestic and export markets. As a result, sellers responded by reducing prices marginally to attract buying interest.

As per SteelMint’s assessment on 5 July 2022, Raipur-based producers offered the material at INR 83,200/t exw, a marginal fall of INR 1,700/t w-o-w while prices in Durgapur dropped by INR 1700/t to INR 82,600/t exw.

Responding to overseas inquiries, exporters offered the 60-14 grade material at around $1,085/t and 65-16 grade at $1,200/t FOB India, a fall of $10/t. SteelMint recorded trade volumes of around 5,600 t this week.

Factors keeping silico manganese prices under pressure-

• Drop in manganese ore prices: Imported manganese ore prices went down due to low demand in the overseas market. Meanwhile, in the domestic market, MOIL has kept manganese ore prices unchanged for all grades for Q3FY23. These factors altogether have kept silico manganese prices under pressure.
• Downtrend continues in Indian steel prices: Indian steel prices were weighed down by weak demand as manufacturers could not conclude deals at higher prices. Weak steel demand has also pulled down silico manganese prices.

China market overview
Silico manganese (60-14) prices in China fell by RMB 50/t at RMB 7,150/t ($1,066/t) exw-Inner Mongolia, while the 65-17 grade was being offered at RMB 8,000/t ($1,193/t) exw-Inner Mongolia. Low demand and rapid fluctuations in the futures market led to a price correction in silico manganese prices.

Meanwhile, silico manganese futures on the Zhengzhou Commodity Exchange (ZCE) for September 2022 delivery recorded a marginal fall w-o-w to settle at RMB 7,743 /t on 5 July 2022.

Outlook
Silico manganese manufacturers are in double pressure of costs as well as demand while their profit margin has reduced. In lieu of further price reductions, most manufacturers plan to reduce or stop production.

Prices are expected to remain stable at the levels of INR 85,000/t in the short-term. However, it is also important to monitor the level of inventory and production of manganese alloys.