- Smelters and traders navigate weak demand
- Need-based procurement seen in domestic market
Prices of domestic silico manganese remained range-bound for another consecutive week, impacted by cautious buying activity.
As per BigMint assessment, the price range of silico manganese (60-14) in India was firm compared to the previous assessment on 7 August. As on 13 August 2024 the price was within the range of INR 68,700-69,300/t exw ($818-826/t) in the major markets of Durgapur, Raipur, and Vizag.
The premium grade of silico manganese (60-15) was available in Durgapur and Raipur at approximately INR 70,000-70,500/t ($833-840/t) exw.
Confirmed deals (as per BigMint)
Factors keeping prices stable
Need-based procurement in domestic market: The Indian domestic silico manganese market has entered a period of relative stability, characterized by cautious buying behavior among steel mills and a range of pricing strategies among producers. Steel mills, anticipating potential price declines, have adopted a need-based procurement approach, limiting purchase volumes. Simultaneously, silico manganese smelters, facing elevated production costs due to high-priced manganese ore, have maintained relatively firm pricing, leading to a standoff in the market.
Balancing act traders, producers: Traders have adopted a strategic pricing approach, offering lower prices at around INR 68,500/t exw ($815/t) Raipur, Vizag and Durgapur to stimulate buying interest and potentially gain market share. Simultaneously, key producers in Raipur and Vizag have implemented production cuts to optimize output and maintain profitability amidst weak demand conditions. These strategies, while aimed at improving individual positions, have contributed to the overall price stability in the market.
Silico manganese export prices down $15/t w-o-w: Indian silico manganese export offers have experienced a decline of $15/t w-o-w, reflecting ongoing challenges in the global market. BigMint’s assessment on August 12, 2024, revealed a mixed price trend, with the 65-16 grade falling by $14/t to $963/t FOB and the 60-14 grade dropping by $16/t to $828/t FOB (Vizag/Haldia).
Key factors contributing to this downturn include:
- Subdued global demand: Delayed purchase inquiries from key markets such as the UAE, Europe, and Bangladesh have significantly impacted export volumes.
- European market recovery: The European market, a crucial export destination, has experienced slower-than-expected post-summer holiday buying activity.
- Geopolitical challenges: Ongoing protests and civil unrest in Bangladesh have further disrupted trade flows.
Outlook
The Indian silico manganese market is anticipated to experience a price decline in near term due to delayed deal closures by steel mills, driven by expectations of further price reductions, have curtailed buying activity. Additionally, the surplus supply of low-grade South African manganese ore has exerted downward pressure on raw material costs, potentially leading to reduce in prices of material.
Close monitoring of market dynamics, including steel production, raw material costs, and global demand, will be crucial for industry participants to navigate this challenging environment.
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