Chinese silico manganese market remains stable on cautious sentiments

Chinese silico manganese prices were unchanged this week as poor negotiations and production cuts caused the market to stay firm. Prices were at around RMB 6,110/t to 6,210/t ($849/t-$863/t). All prices were ex-works and inclusive of taxes.

Factors that kept the market stable:

Weak negotiations, suspension of production: The silico manganese market was stable this week with some challenges such as weak market negotiations. Meanwhile, the suspension in production for maintenance by some companies also contributed to market stability.

Lower demand: Demand softened for silico manganese in China as smelters held back on purchases in an uncertain market and on dwindling profits.

Volatility in market: It seemed like there were various factors at play that impacted the manganese ore market, such as the instability in raw materials and the recent repairs to the railway tracks in Gabon.

The railway track linking Gabon's Ovindo and Franceville ports is now fully operational, though a limited window for arrivals exists contributing to declining port inventory. Amidst external market support, a potential rebound in mining prices is anticipated.

Challenging downstream market: The downstream market experienced lower prices, with procurement decisions being driven by demand. It appears that there are challenges such as poor performance in the futures market and cautious sentiment among industry players.

However, there is optimism for increased demand as steel recruitment progresses, and suppliers are hopeful about the market outlook. It will be important to monitor low-price transactions and changes in the supply and demand dynamics of silicon manganese in the short term.

Outlook

It seems that there is a general sense of caution and uncertainty among buyers and sellers. Meanwhile, China's Hebei Iron and Steel (HBIS) Group has cut its silico manganese bid prices for March delivery at RMB 6,300/t ($876/t), down RMB 150/t ($21/t) from the previous month.

BigMint anticipates that the silico manganese market may witness further fluctuation in prices in the near term, as the Chinese market reflects unfavourable sentiments.

Note: This article has been written in accordance with an agreement between CBC and BigMint.