India: Silico manganese domestic prices surge amid cost pressures, export growth

• Price surge driven by rising production cost, export demand
  
  
• High-priced exports fuel upward trend in silico manganese
  
  

The Indian domestic silico manganese market has witnessed a significant price increase this week, reaching its highest level in eleven months, surpassing the previous peak observed in June, 2023.

BigMint's assessments on 23 April revealed a w-o-w surge by around INR 1,200/t ($14/t) for grade 60-14, settling at INR 71,800-73,000/t ex-works ($862-876/t). Notably, Raipur offers have climbed further to INR 73,000-73,500/t ex-works, with deals reported at even higher prices.

Meanwhile, the premium grade (60-15) also witnessed a rise, reaching INR 74,000-74,500/t exw ($888-894/t) in Durgapur and Raipur.

Factors boosting prices of domestic silico manganese

Escalating imported raw material prices w-o-w: A rise in the cost of key raw materials, particularly in imported manganese ore of around $0.05/dmtu w-o-w across the grade, and coking coal increased by $5 w-o-w to $265/t CNF India, has also supported manganese alloys prices. Production costs in Raipur, a major production hub, currently hovered around INR 71,500-72,000/t ($858-864/t). This cost pressure is anticipated to translate into further upward price adjustments in the near future. This resulted in domestic commodities price increase.

Indian silico manganese exports prices rise by $22/t w-o-w: Indian silico manganese exports prices jumped $22/t this week due to supply concerns. Strong demand is evident with bookings reaching an 11-month high, and producers are booked through first week of May. BigMint's assessments on 22 April 2024, the 60-14 grade was assessed at $870/t FOB, up by $21/t w-o-w, and the 65-16 grade was rated at $967/t FOB, up by $24/t w-o-w. Furthermore, some major producers in Vizag and Raipur were still offering SiMn 65-16 grade Vizag/Haldia at a FOB of $980-$1,000/t.

Recent export activity in the silico manganese market is providing a significant boost to domestic prices. A notable 1,000 tonnes (t) deal for grade 65-16 material concluded at a high price point of around ?80,000/t exw ($960/t). This strong export demand is further fuelling the upward momentum already observed in the domestic silico manganese market.

Outlook

The confluence of rising raw material costs, robust export demand, and disruptions in Australian supply painted a picture of a potentially sustained upward trajectory for silico manganese prices in the Indian domestic market in the near term. However, for an accurate long-term price forecast, close monitoring of evolving market dynamics, including cost pressures and global supply developments, remained essential.

Additionally, recent price increases have been observed for imported manganese ore, including a rise in offers for Gabonese ore grade 44% to USD 5.5-5.6/dmtu, CNF Haldia/Vizag.