- Prices rise by around INR 1,200/t w-o-w
- Raipur, Durgapur smelters cut production by almost 50%
- Material shortage keeps domestic prices on higher side
Production curtailment and active inquiries have propelled domestic silico manganese prices in India to rise to a three-month high, reveals data maintained with BigMint. Prices have jumped by almost INR 1,200/t ($14/t) on a weekly basis. A few significant purchases of the 60-14 grade at higher tender prices and a restricted supply in the spot market, along with an increase in export inquiries, also kept domestic prices high.
According to BigMint’s assessments, the price of silico manganese in Raipur touched INR 66,000/t exw ($795/t), up INR 1,400/t ($17/t) w-o-w. Durgapur saw a weekly price increase by INR 1,100/t ($13/t) exw, to INR 66,000/t exw ($795). Vizag’s prices rose by INR 1,100/t ($13/t), to INR 66,600/t ($802/t).
The export price of Indian silico-manganese also increased this week, extending a rise that began in the second week of January. According to sources, offers have risen in tandem with the increase in export volumes, with material shortages driving up prices.
One of the primary exporters informed BigMint that there were limited import choices into western Europe from Ukraine, since the latter, beset by war, has been trying to meet domestic demand. War tensions have raised interest in Indian silico manganese.
Factors influencing silico manganese prices:
- Material shortages in domestic market boost prices: Major producing locations, such as Raipur and Durgapur, have reduced production by around 50%. Numerous enterprises have stopped output and placed furnaces on maintenance till the market recovers due to high production costs and electricity rates. A few plants in Durgapur have also turned to other commodities, such as ferro chrome and sponge iron, because they generate higher profit margins than manganese alloys do. Resultantly, there is material shortage.
- Shift in production to high grade SiMn: Furthermore, many of the plants have continued to produce high-grade silico manganese (65-16), as there was anticipation of a rise in export demand for the high-grade material in mid-January. This resulted in an increase in production, but limited supply of the lower grade (60-14) in the spot market. This prompted domestic silico manganese prices to rise even further.
Furthermore, sellers’ bids in the domestic market ranged from INR 67,500-68,000/t exw ($812-$820/t) in Raipur, Vizag, and Durgapur, owing to a few deals done at these price levels in the export market.
- Enhanced export bookings keep prices robust: Export demand remained strong, providing support to manganese alloys prices in the spot market. Last week saw a substantial increase in trade volumes with roughly 7,000t (export deals only) being recorded by SteelMint. This is higher than 1,800t recorded in the previous week. According to BigMint’s assessments on 29 January, 2024, the 60-14 grade was evaluated at $820/t FOB, up by $10/t over the previous week, and the 65-16 grade was assessed at $920/t FOB, up $15/t.
Outlook
Given the restricted inventory and positive outlook, market participants expect prices to rise in the near term.