- Soft steel demand weighs on alloy procurement
- High smelter stocks continue to pressure sentiment
MySteel Global: China’s silico manganese prices continued to fall in the week ended 28 Nov, with the national price of 65-17 silico manganese under Mysteel’s assessment touching a five-month low of RMB 5,494/tonne ($777/t) including the 13% VAT on November 28, lower by RMB 17/t ($2/t) from one week before.
Prices of the ferro alloy in the derivative market also weakened last week. On 28 November, the most-traded silico manganese contract on the Zhengzhou Futures Exchange for delivery in March 2026 closed the daytime trading session at RMB 5,616/t, ($794/t) down by RMB 12/t ($1/t) from the contract’s settlement price on 21 November, according to the exchange’s data.
The weakness of domestic silico manganese prices was partly due to shrinking demand from steel producers. More Chinese steel mills have been operating at a loss recently and in response, they are cutting their procurement prices of steelmaking raw materials including silico manganese .
In parallel, the steady climb in inventories held by domestic silico manganese smelters has also put some pressure on silico manganese prices, Mysteel Global noted.
Mysteel’s other weekly survey showed that as of 27 November, silico manganese stocks among the 63 sampled smelters under its tracking totalled 368,000 tonnes, swelling for the 13th consecutive week by 5,000 tonnes on week. These smelters represent about 80% of China’s total silico manganese smelting capacity.
Meanwhile, over 21-27 November, the combined daily production among the 187 Chinese smelters under Mysteel’s tracking averaged 27,825 tonnes/day, falling for the fourth straight week by 305 t/d on week. Last week some silico manganese smelters had conducted maintenance on their smelting facilities to alleviate their supply-side pressure and to cut their losses on silico manganese sales. The 187 sampled smelters host about 99% of China’s silico manganese smelting capacity.
The persistent weakness in silico manganese prices has also dragged down the country’s prices of manganese ore. On November 28, Mysteel assessed the price of South Africa-origin 36.5% grade manganese ore at North China’s Tianjin port at RMB 34.2/dmtu ($5/t) including the 13% VAT, dipping by RMB 0.1/dmtu on week.
For the near-term future, many domestic silico manganese smelters are unwilling to make more concessions in their offering prices, as their smelting costs remain high with the relatively firm prices of manganese ore, a market source in Shanghai said.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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