India: Domestic silico manganese prices fall by INR 500/t ($6) on reduced overseas inquiries

• Declined offshore demand caused silico manganese prices to come down
  
  
• Fluctuations in steel market, need-based buying weigh prices
  
  
• Market awaits MOIL's manganese ore offers for March
  
  

India's domestic silico manganese prices witnessed a w-o-w decline driven by the reduced overseas inquiries which has led to a decrease in buying activity, putting downward pressure on prices. Also, fluctuations in demand from the steel industry, a major consumer of silico manganese, further exacerbated the price decline as consumption dipped.

Market participants exhibited caution in their transactions, and opted for need-based buying rather than large-scale purchases. This suggests a wait-and-see approach in anticipation of potential future developments.

According to BigMint's assessment, silico manganese prices in Raipur were at INR 67,600/t exw ($81/t), down by INR 600/t ($7/t) w-o-w. Meanwhile, prices in Vizag were at INR 67,700/t exw ($816/t), down by INR 400/t. Durgapur, producers' offers also shrank by INR 500/t ($6/t) to INR 67,500/t exw ($814/t). Overall, prices dipped by INR 500/t ($6/t).

Market highlights

Weaker overseas demand: Inquiries from the export market has slightly diminished which impacted the domestic silico manganese prices. Notably, demand diluted from European region post-Lunar holidays in China, as Chinese players gave competitive offers to European buyers which resulted in dragging down the silico manganese prices in the domestic market. Silico manganese export prices declined this week owing to demand-supply disparity in the market. According to BigMint's assessment on 26 February 2024, the 60-14 grade was assessed at $828/t FOB, down $17/t, while 65-16 grade prices were at $930/t FOB, down $15/t.

Domestic producer showed concern by quoting, "The ongoing situation has put pressure on the sellers to lower their quotes as a lot of material is lying at the ports, that material is being rolled out in the domestic market with lower quotes as export demand subdued".

Need-based buying in domestic market: Purchases happened only when required looking onto the ongoing market situation. A wait and see approach being adapted by the market players and many of them were hesitant in accepting material at higher quotes which could also be a significant reason for decreased silico manganese prices.

This week sellers quoted their offers in the range of INR 68,000-68,500/t ($820-$826/t), but deals took place at INR 67,000-68,000/t ($808-$820/t) levels.

Billet prices remain range-bound: Domestic steel demand was volatile last week, with no bulk booking queries, allowing silico manganese prices to go down with their previous levels. However, BigMint's steel billet index was INR 39,300/t ($471/t) ex-Raipur on 28 February, 2024, stable with slight increase by INR 50/t ($1/t) from the previous week.

Billet market indicated strong fluctuations with very less trades in the last week, sellers tried to put their quotes on the upper side but buyers were hesitant in accepting the offers, this has also put pressure on the domestic silico manganese prices.

Outlook

BigMint's analysis of domestic silico manganese prices, anticipates a potential price fluctuations in the coming week, driven by subdued demand. This indicates that market participants may adopt a cautious approach to pricing, potentially leading to some volatility.

However, a contrasting view emerges from a Raipur-based producer. They anticipate a slight increase in silico manganese prices. This expectation stems from market participants' belief that MOIL, a key player in the manganese ore market, is likely to announce prices for March deliveries soon.