- Limited offers spark price uptick in domestic silico manganese
- MOIL raises manganese ore prices by up to 6% for Apr’24
Silico manganese domestic prices in India saw a modest increase this week. Grade 60-14 prices rose by INR 500-1,300/t ($6-15/t) w-o-w to settle at INR 66,000-66,900/t exw ($790-801/t) in key production regions as per BigMint’s assessment 2 April, 2024. The premium-grade (60-15) reached INR 67,500-68,500/t ($808-819/t) exw in Durgapur and Raipur.
“To maintain profitability, producers are probably going to look for price increases that close the growing gap between their costs of production and the ongoing rates in the market,” highlighted one of the major producers from Raipur.
Factors supporting prices
- Limited offers in market exert upward pressure: Despite the sparse trading, there is less room for price decline due to tight supply. The primary driver behind the price hike is a tightening supply situation in the domestic market. This limited availability of readily available material is creating a supply squeeze, putting pressure on producers and pushing prices upwards. With most major producers currently booked for production through April 2024, a supply squeeze is emerging in the market.
- MOIL lifts manganese ore prices m-o-m: MOIL has increased Mn grades above 44% lumps by 6% growth in offers m-o-m, while lumps below 44% have increased by 3%. This increase in manganese ore prices will increase the cost of production of the lot for which deliveries arrive after 15 days. Meanwhile, imported manganese ore prices have shown an upward movement on a weekly basis owing to increased cost of production and other charges. This has also impacted the price of silico manganese to rise further.
- Hike in billet prices: Domestic steel demand remained moderate last week with limited inquiries and bookings, which kept prices on the higher side. BigMint’s daily steel billet index was assessed at INR 41,400/tonne (t)($496/t, up by INR 1,100/ t ($13/t) w-o-w) exw-Raipur on 3 April 2024.
- Indian silico manganese exports price stable: Indian silico manganese exporters are stuck in neutral. BigMint’s assessments on 2 April, 2024, reflected this stability, with the 60-14 grade remaining unchanged at $812/tonne (t) FOB and 65-16 holding steady at $912/t FOB. Major producers in Vizag and Raipur continued to offer the SiMn 65-16 grade at a FOB range of $912-$915/t. This stalemate due to weak global demand have stalling exports and kept prices stagnant.
Outlook
Indian silico manganese prices are facing an upward pressure due to rising manganese ore costs and tightening domestic supply. Some players are targeting for INR 68,000/t exw Raipur levels. Key factors to monitor include domestic bulk tender deals price and imported manganese ore price movements, which will influence the extent and timing of potential price hikes in the coming weeks.
On the other hand, in order to compensate for financial losses at the state-run power utility, Taiwan is raising average electricity prices by 11% as of 1 April, 2024. The government has been working to lower consumer energy costs and inflation, but this increase still occurs. The 25% increase will be more abrupt for large industrial users. This could lower the monthly imports of silico manganese. Taiwan’s yearly imports decreased by 14% y-o-y to 95,961 t in calendar year 2023 (CY’23), out of which imports from India were around over 65,000 t.