- Export prices weaken on reduced demand in key importing countries
- Silico manganese export market faces headwinds
Indian silico manganese exports witnessed a price decrease of $30 per tonne compared to the previous week, reflecting sluggish demand in the market.
According to BigMint’s assessments on 20 May 2024, the 60-14 grade was assessed at $1,115/t FOB, decreased by $35/t w-o-w, and the 65-16 grade was at $1,220/t FOB, a drop of $30/t w-o-w. Furthermore, some major producers in Vizag and Raipur were offering SiMn 65-16 grade ex-Vizag/Haldia at an FOB of $1,230-$1,240/t.
Confirmed deal
Global market observations this week
Low demand from key countries hits exports: Steel mills in major consuming regions like Europe and Southeast Asia, previously significant buyers of Indian silico manganese (0.45 mnt annually in CY’23), have reduced intake due to sluggish steel demand and liquidity issues. This decline could lead to lower export prices for Indian silico manganese and necessitate adjustments for Indian exporters. The steel sector’s recovery in these regions is key for a rebound in demand.
Exports face price pressure on lower asking price: Silico manganese exporters face a challenging market. Weak demand from the alloy steel sector forces price cuts to clear stocks. Subdued trading globally further dampens buying activity. Indian port inquiries for silico manganese at $1,090-1,110/t FOB (Vizag/Haldia) suggest downward pressure on export prices. A few deals at these levels raise buyer hopes for lower prices.
While the raw material, manganese ore, shows signs of potential price hikes, import and domestic ore prices remain stable. This suggests potential supply chain resilience or a wait-and-see approach from other market players. The contrasting signals and weak demand create pressure on silico manganese export prices.
Outlook
Silico manganese exports face short-term volatility due to weak demand and a squeezed margin between falling export prices and rising raw material costs. Exporters need to closely monitor market dynamics and adapt strategies to navigate this challenging environment.
The news of South 32, a major supplier, resuming operations in June 2024 could lead to a decrease in manganese ore prices. A potential drop in manganese ore prices would likely trigger further downward adjustments in silico manganese export offers.