India: Seaborne manganese ore oversupply, low demand lead to price fall

Imported manganese ore prices hit a year-to-date high during late April on supply concerns after South Africa implemented nationwide lockdown. Post-lockdown, when the supply concerns eased and the Chinese inventory started piling up, the South African miners had to lower their offers. China accounts for more than 60% of the total manganese ore exports from South Africa.

Current prices for manganese ore CNF India are at $4.05/dmtu for Mn 37% of South African origin, $4.35/dmtu for Mn 44% of Gabonese origin and $4.65/dmtu for Mn 46% of Australian origin.

Indian manganese ore imports in Sep’20 was substantially higher, by 73% m-o-m, and the producers will wait for the prices to fall further before making fresh bookings as they have sufficient inventories. Moreover, the uninspiring silico manganese market in India has further dampened the buying interest.

The buying interest shifted towards the higher-graded Gabonese and Australian manganese ore as the prices went down. Indian buyers are now more interested in buying higher grade ore to blend with the domestic low graded ores.

Chinese Manganese ore port stock
Chinese manganese ore port stocks are at a record high to up to 7.3mn t at the end of Oct’20, which is curbing the demand from Chinese manganese alloys producers. The manganese ore imports are not falling, and the inventories are piling up, showing less consumption in the domestic market. Meanwhile, the market participants are holding a wait and watch approach towards the manganese ore procurement.

Meanwhile, South 32, one of the largest miners of manganese ore further lowered their December offers by $0.17/dmtu to $4.25/dmtu for Australian ores and $0.2/dmtu for South African ores to $3.9/dmtu in the third revision. Other miners are expected to follow as the sentiments for manganese ore turn bearish.

Outlook:
Indian silico manganese producers have enough inventory of manganese ore currently and after MOIL decreased their prices, they might wait for the seaborne prices to fall further before making future bookings. Manganese ore prices have been on a continuous downtrend and any rise in prices seems unlikely at present.