China: Silico Manganese Market Grows Stronger

As most steel mills have completed purchases before the national holiday, demand release in a short period afterward is expected to be soft. Last week, the spot price of Silico Manganese in the market took on a weaker trend as a result. Today as the market opens, some producers might provide discounts in order to maintain market vitality. In several provinces of the main producing areas, Silico Manganese 65-17 grade price is still relatively firm around RMB 8,350-8,450/MT (USD 1207- 1221/MT).

Considering a rise in raw material prices such as that of Manganese Ore and Coke, coupled with restricted power supply due to wind power shortage has encouraged producers to maintain their prices firm. Producers are still facing limited power supply and this situation is likely to roll on till the year-end, depending on actual power shortage. Some producers said these incidents might have an impact on the output.

The alloy index shows that the price of Silico Manganese 65-17 grade has no major adjustment compared with last week. Specifically, the price in Henan, Hebei, Shandong, Jiangsu is RMB 8,565-8,859/MT (USD 1238-1280/MT).

Manganese Ore Market

In terms of the manganese ore market, the decline in total port inventory and the increase in overseas offers, particularly for those from South Africa and Gabon, have enabled traders to stand firm on manganese ore offers. Last week, the sentiment to support the price hike of Manganese Ore was on the rise. Today, although the spot price has not been adjusted yet, the prices of Ores from other foreign mines besides Comilog is expected to increase.

Therefore, an addition of new capacity of Silico Manganese owing to its anticipated demand will create more positive sentiment for Manganese Ore traders’ confidence and is hence expected to consolidate further with some traders trying to increase prices. Although weakening of the price of Silico Manganese will inevitably affect the acceptance of the Manganese Ore prices, its market will remain firm in the short-term.

Future Outlook

It has been gathered from many alloy producers that some Silico Manganese plants are busy delivering orders and some are with ample inventory. However, a limited amount of circulating resources, on the whole, will not lead to a sell-off condition.

On one hand, the sellers are strictly monitoring the market as they lack direction for another round of tenders during the mid-month period, while on the other, the power cuts in major regions have affected the output of Silico Manganese, and an upswing in the raw material prices will undoubtedly provide support to the Silico market. In addition, the implementation of the new standard for Rebar is also an opportunity for Silico Manganese.