- Global steel production slowdown pressures Indian prices
- Tight trade financing, safeguard risks curb buying apetite
Indian silico manganese export prices inched down w-o-w, driven by faltering global demand. Weakened steel production, macroeconomic headwinds, and elevated stockpiles in key importing regions curtailed buying interest, exerting downward pressure on prices.
Additionally, currency fluctuations, tighter trade credit, logistical challenges, and cautious buying amid geopolitical uncertainties compounded the decline in India’s silico manganese export prices.
According to BigMint’s latest assessment, Indian silico manganese export prices declined slightly w-o-w, with the 65-16 grade falling by $3/tonne (t) to $933/t FOB, and the 60-14 grade slipping $2/t to settle at $850/t FOB.
Market updates
Global steel production slowdown reduces demand: Major steel-producing countries, including China and Europe, have scaled back production due to slower industrial growth and weakened construction activity. This decline in steel output has directly reduced demand for silico manganese, an essential alloy in steel manufacturing. Exporters stated that buyers are postponing or reducing orders amid this slowdown, leading to a dampened export market and downward pressure on prices.
Elevated inventories limit urgent procurement needs: Importers in key regions such as China, South Korea, Japan, and the European Union accumulated significant stockpiles of silico manganese during previous buying cycles. These elevated inventories lessened the urgency for fresh purchases, causing a drop in procurement volumes. Traders and exporters highlighted that this surplus inventory has been a major factor restricting demand, as buyers prefer to exhaust existing supplies before placing new orders, thereby depressing export prices from India.
Tighter trade financing restricts buyer flexibility: Financial institutions have become more stringent in offering trade credit amid global economic uncertainties. Buyers face increased challenges in securing affordable financing for raw material imports, limiting their purchasing power and willingness to commit to large volumes.
Additionally, the looming risk of safeguard duties and import restrictions in several key markets has heightened buyer caution, prompting tighter negotiation on prices and reduced procurement, thereby intensifying downward pressure on Indian export prices.
Outlook
Export prices of Indian silico manganese are likely to remain under pressure as global steel demand softens and safeguard duty risks persist, prompting cautious buyer behaviour in the near term.
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