China's manganese ore prices keep stable on cost support

Chinese manganese ore prices kept stable over the past week thanks to firm cost support, with the price of South Africa-origin 36.5% grade Mn ore at North China's Tianjin port under Mysteel's assessment staying at Yuan 31/dmtu ($4.4/dmtu) including the 13% VAT as of May 24, the same level from one week before.
Many domestic traders refused to trim their offering prices further given their high-level costs on imported manganese ore at China's major ports.

Meanwhile, consumption of these ore from downstream manganese alloy smelters is expected to increase somewhat in the coming term, as some smelters in Southwest China's Yunnan may resume operations with the expectation for lower electricity prices next month, Mysteel Global learned.

However, domestic manganese ore prices still face great pressure to move up in the near term, mainly due to the high ore inventories at major ports and persistent weakness in silicomanganese prices, market participants predicted.

As of May 19, total inventories of manganese ore at China's major ports came in at 6.46 million tonnes, still a very high level though it had retreated slightly by 106,000 tonnes or 1.6% from the 26-month high over the prior week, according to Mysteel's latest weekly survey.

On the other hand, China's SiMn prices weakened continuously due to the imbalance between supply and demand, persuading domestic smelters to cut their procurement prices for feed raw materials including manganese ore to reduce production costs and guarantee their profit margins, Mysteel Global noted.

The national price of 6517 SiMn was assessed by Mysteel lost another Yuan 49/t on week to Yuan 6,786/t including the 13% VAT as of May 24, a new low since April 29 2021.

SiMn prices in the derivatives market also lost ground over the past week, with the most-traded SiMn futures contract on the Zhengzhou Futures Exchange for September delivery closing the daytime trading session at Yuan 6,672/t on Wednesday, lower by Yuan 104/t from the settlement price on May 17, the exchange's data showed.

Note: This article has been written in accordance with an article exchange agreement between Mysteel Global and SteelMint.