Silico manganese prices in the domestic market have fallen to over 3.5 month low, as per data maintained with SteelMint. As per latest assessment, offers in Raipur were at around INR 72,600/t exw, down by 1% w-o-w, while those in Durgapur were at INR 72,200/t exw, down 1% w-o-w.
Prices have fallen by around 12% from the beginning of CY23. Prices had been assessed at INR 82,500/t exw on 3 January.
Meanwhile, producers’ quotes for grades 60-14 remained at around INR 72,500-73,500/t exw-Raipur, Durgapur producers quoted at INR 72,000-73,000/t exw. However, traders offered at around INR 71,800-72,500/t exw in both markets amid weak demand.
During the week, SteelMint recorded trade volumes of around 2,200 tonnes (t) of manganese alloys in the domestic market. A few discounted bulk purchases of the material were also made.
Silico manganese export offers stood at around $880/t FOB for 60-14 grade, down $30/t from last week, while prices for 65-16 grade were assessed at $990/t FOB, down $39/t w-o-w.
SteelMint recorded trade volumes of around 800 t in the export market amid weak demand.
Sentiments affecting silico manganese prices
- Persistent weak demand: Lack of liquidity has widened the gap between demand and supply of manganese alloys over the past few months. Consequently, silico manganese prices globally was impacted on high inflation and decreased liquidity, which also impacted domestic pricing. Moreover, low steel consumption resulted in material being stockpiled for more than three months, which weakened demand and forced manufacturers to cut prices of silico manganese.
- Subdued steel demand: Lack of demand and fluctuating raw material prices kept the Indian steel market sluggish. As a result, when it came to reserving bulk volumes, many customers preferred to wait to see if spot prices would weaken further. SteelMint’s domestic steel billet index was at INR 46,000/t exw-Raipur on 28 March, up by INR 350/t w-o-w.
- Manganese ore prices fall: Low demand for manganese alloys forced production cuts by the smelters in the domestic market and contributed to the lowering of manganese ore prices, which impacted silico manganese prices. Imported manganese ore of Mn37% grade (of South African origin) was being offered at $4.25/dmtu CNF East Coast, down 2% w-o-w. The Mn46% grade (Australian origin) was offered at $5.85/dmtu CNF Vizag, according to SteelMint’s assessment.
- Global silico manganese market bearish: Bearish sentiments persisted in the global silico manganese market which dampened liquidity, thus affecting domestic market prices. Volumes for the export market last week stood at just 800 t.
- Bid offer disparity: Lack of buying interest and uncertain market conditions resulted in limited international enquiries. Seaborne purchasers sought material at a significant discount to bids. But it was difficult for smelters to sell material at such low prices, which led to low export transactions. Consequently, prices inched down.
Outlook
Silico manganese prices are expected to fluctuate in the short term. As a result of limited production, India’s manganese alloys supply is declining. Prices of materials may fluctuate further if export enquiries and steel demand increase.
Additionally, for energy-intensive companies, the Andhra Pradesh Electricity Regulatory Commission (APERC) will raise monthly electricity costs to INR 475 per KVA. This may have a direct impact on silico manganese prices and market dynamics.
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