India: Silico manganese prices remain under pressure amid downtrend in steel demand

Indian silico manganese prices have remained under pressure for the last three weeks amid sluggish demand for steel.
According to SteelMint’s assessment on 6 September, Raipur-based producers offered at around INR 75,900/tonne (t) exw, down by INR 2,100/t w-o-w, while prices in Durgapur were at INR 75,200/t exw, dropping by INR 2,000/t against last week.
Responding to overseas inquiries, exporters offered the 60-14 grade at around $/960t, down by $10/t from last week. Prices for the 65-16 grade were assessed at $1,060/t FOB India, down by $10/t w-o-w.
Meanwhile, SteelMint recorded trade volumes of around 3,000 t in a shrinking market.
Factors affecting prices of silico manganese

• Decline in demand resulted in excess steel inventory at the mills and, as a result, Indian steel prices remained weak. Due to this, silico manganese prices declined.
• Additionally, due to sluggish buying interest and uncertain market sentiments, international inquiries were muted. Consequently, silico manganese prices declined marginally.
• Furthermore, fall in manganese ore prices from major miners in China also influenced end-users to negotiate and book the material at lower prices.
• Moreover, manganese ore prices declined as buyers of manganese alloy products became less interested in the imported variety. Over the past few months, demand has been sluggish and inventories have been high.
• Some sellers were selling low under pressure owing to a liquidity crisis.

China market overview
China’s silico manganese (60-14) prices stand stable at RMB 6,400/t ($1,920/t) exw-Inner Mongolia, while the 65-17 grade was offered for RMB 7,075/t ($1,017/t) exw-Inner Mongolia. China’s silico manganese prices declined due to a consistently weak demand and declining raw material prices. In the short term, silico manganese prices in China are expected to remain weak but stable.

However, silico manganese futures on the Zhengzhou Commodity Exchange (ZCE) for October delivery climbed w-o-w to RMB 7,094 /t on 6 September 2022.
Outlook
Amid the downtrend in the steel market, participants expect prices of silico manganese to remain bearish in the coming weeks.