India: Domestic silico manganese prices face pressure amid softening steel market

• Raigarh, Durgapur producers' competitive offers weigh on tags
  
  
• Export prices drop amid weak demand, aggressive Chinese offers
  
  

India's domestic silico manganese prices largely declined this week, as steel mills, grappling with weak demand, adopted a cautious approach to procurement.

According to BigMint's assessments on 19 November 2024, prices of the 60-14 grade fell by INR 500-700/tonne (t) ($6-9/t) w-o-w to INR 65,000-65,600/t ($770-778/t) exw. Offers in Raipur stood at INR 66,000-66,500/t ($782-788/t) exw.

However, premium-grade (60-15) silico manganese prices witnessed a slight increase to INR 66,500-68,000/t ($788-$805/t) exw in both Durgapur and Raipur.

Confirmed deal (as per BigMint)

Market review

Steel demand remains slack: The domestic silico manganese market is experiencing a slowdown due to weaker demand from the steel sector. The decline in steel prices persists, with BigMint's daily steel billet index closing at INR 39,100/t exw-Raipur on 19 November 2024, down by INR 500/t w-o-w.

The steady fall has led to a cautious approach among buyers, impacting the demand for silico manganese. As a result, the market has witnessed limited inquiries and reduced consumption. Moreover, this wariness is expected to continue in the near term, potentially leading to further price adjustments.

Domestic producers take up aggressive pricing: Domestic producers, primarily in Raigarh and Durgapur, have been offering silico manganese at competitive prices of around INR 64,500-64,800/t exw ($764-767/t). This aggressive pricing strategy has intensified competition and exerted downward pressure on domestic prices.

Wide supply-demand gap pressures global market: The global market for silico manganese is also experiencing challenges, with lower demand and increased supply impacting international prices. These factors have put pressure on India's silico manganese segment as well, resulting in lower prices and reduced margins.

Export prices drop amid weak demand: Indian silico manganese export offers fell marginally by approximately $15/tonne (t) w-o-w, primarily due to weak global demand and surplus supply. Chinese exporters are aggressively reducing offers to stimulate demand, and, as a result, bearish sentiments dominate the seaborne market.

BigMint's assessment on 18 November 2024 revealed relatively stable prices: the 65-16 grade edged down by $8/t to $890/t FOB, while the 60-14 variant inched down by $17/t to $798/t FOB. Higher offers for 65-16 did not find acceptance, and sellers were compelled to knock their offers down to $880-900/t FOB.

Outlook

The domestic silico manganese market is currently experiencing uncertainty due to fluctuating steel demand and cautious buyer sentiment. While a potential uptick in steel demand could positively impact silico manganese prices, the near-term outlook remains uncertain.