China Manganese Ore Market Keeps Firm on Rising Import Prices
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China's market for Manganese ore remains firm because of rising import prices of this ore. As of April 21, the price index for South Africa-origin 36.5% grade manganese ore at North China's Tianjin port was at a 16-month high of Yuan 53.8/dmtu (USD 7.6/dmtu) including the 13% VAT, gaining by another Yuan 3.32/dmtu on week and marking a substantial increase of Yuan 18.32/dmtu from one month earlier, Mysteel's data showed.
The domestic Manganese ore market has turned robust was mainly thanks to the fact that many overseas mines anticipate a reduction in supply over the coming two or three months and so have lifted their offering prices for shipments to China, Mysteel Global learned, giving a positive boost to domestic market sentiment.
Consolidated Minerals Limited (CML), a large manganese ore producer with mining operations in Australia and Ghana, announced that its price for manganese lump ore with Mn higher than 46% will increase by USD 1.55/dmtu on month to USD 6/dmtu CIF China for shipments in May.
Manganese ore exporters in South Africa are likely to cancel their offering prices for May shipments, as they need some time to reschedule shipments delayed from March and April if transportation does resume next month as scheduled. South Africa's nationwide lockdown commenced from March 26 and runs until April 30, as Mysteel Global reported.
Thus, United Manganese of Kalahari (UMK), a manganese ore producer and exporter in South Africa, has directly released its price for shipments for June-July, with that for 36% manganese ore reaching USD 6.98/dmtu CIF China, representing a large USD 2.38/dmtu increase from that for April.
Views among market participants differ regarding the rapid rise in import prices for this ore, Mysteel Global found. "Some Chinese traders would like to wait and see for the moment because of the larger-than expected rise in price, while some domestic importers seem willing to accept the high offer prices given the limited supply," a market insider in Shanghai said.
Manganese ore prices are expected to remain firm as supply is unlikely to return to normal any time soon, even if mines in South Africa can resume operations in May, Mysteel Global notes.
South32 Limited, the world's top manganese ore miner headquartered in Perth, Western Australia, has lowered its production guidance for its Australia Manganese venture by 5% to 3.38 million wet tonnes for FY20 spanning July 2019 through June 2020 to respond to the impact of the COVID-19. The company also removed the guidance for its manganese ore operation in South Africa following the nationwide lockdown, as Mysteel Global reported.
The strengthening manganese ore price also lent some support to China's silicomanganese market, with the price for 65-17 grade Silico Manganese in North China hitting a seven-month high of Yuan 7,075/MT EXW including the 13% VAT as of April 21, increasing by Yuan 275/MT on week or surging by Yuan 1,050/MT on month, according to Mysteel's database.
(This article has been published under the article exchange agreement between SteelMint Research and Mysteel Global.)
