- Muted steel demand, rising inventories weigh on prices
- Photovoltaic industry policy boosts sentiment in alloy sector
CBC: Chinese silico manganese (Mn:65%, Si:17%) prices edged up by RMB 20/t ($3/t) w-o-w to RMB 5,580-5,850/t ($778-$816/t) exw, including taxes.
Silico manganese prices edged up, driven by supply constraints due to delayed capacity additions and maintenance in key regions. High electricity costs in the south further limited production. Steel mills resumed restocking, while firm raw material prices supported producers margins. Market sentiment also improved, supported by policies aimed at curbing low-price competition.
Market recap
Ore market sees mixed trends: Among manganese ore, prices of Tianjin, Hong Kong, and Macao blocks, as well as Gabonese variants, remained stable. Meanwhile, semi-carbonate prices inched up slightly due to rumours of rail shipment disruptions in South Africa, and traders were reluctant to sell at low prices. Arrivals at Qinzhou Port remained low, and tight oxide ore inventory supported miners firm price stance.
Although South African ore prices to China dipped slightly in July, the depreciation of the RMB offset the cost advantage, keeping prices above the same period last year. The fourth round of coke price hikes eased energy cost pressures, but rising electricity prices in Inner Mongolia partly offset these gains.
Demand remains muted, inventories rise: The off-season trend in the steel market remained apparent. Bids from East China-based steel mills edged up, while North China-based mills continued to buy at lower prices, showing that end-user demand recovery is still limited. The shift to new national rebar standards led some mills to suspend operations for maintenance, which pushed up actual silico manganese consumption.
Notably, the photovoltaic industry’s policy to curb low-priced competition improved industrial market sentiment, indirectly encouraging speculative capital into the alloy segment. On the inventory front, factory and warehouse stockpiles in Ningxia rose significantly, indicating that spot market consumption was slower than expected.
Outlook
In the short term, silico manganese prices may remain volatile, with the supply recovery in Yunnan, southwestern China, offset by maintenance in northern regions. Demand could improve on steel restocking, but softer coke prices may erode cost support.
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