India: Silico manganese prices fall to over two-year lows amid weak steel demand

Silico manganese prices fell to more than two years' low due to weak demand in both the domestic and key export destinations. Similar price levels were last seen on 8 January 2021 as per data maintained with SteelMint.

As per SteelMint's assessment, silico manganese offers in Raipur are at around INR 68,700/tonne (t) exw, dropping 2% w-o-w. Prices in Vizag touched INR 69,700 t exw, down by 1% on a weekly basis and in Durgapur, these were at INR 67,700/t, 2% w-o-w.

Producers' quotes for grade 60-14 remained at around INR 68,500-69,500/t exw across Raipur, Vizag, and Durgapur. However, traders offered at around INR 67,500-68,000/t exw in all three locations, forced by weak demand.

SteelMint recorded trade volumes of around 4,200 t of manganese alloys in the domestic market this week.

Factors affecting prices of silico manganese

• MOIL lowers manganese ore offers: MOIL reduced prices of all grades of manganese ore for Q3CY23. The miner cut prices for grades higher than Mn 44% by 5% from June's offers.

  
  
  

• Subdued global sentiments: Thanks to subdued global steel demand, key exporting countries like Zambia and Malaysia offered highly competitive prices, particularly for the 65-17 grade, which were as low as $850-$880/FOB. This scenario impacted India's export sales, and forced a drop in silico manganese export offers, which fell 1% w-o-w. On 3 July, the 60-14 grade export price was at $858/t FOB, w-o-w. Export prices for the 65-16 grade were at $910/t FOB, down 1% w-o-w.

  

  
  
  

• Demand-supply dynamics: High inventory continues to weigh on both buyers and sellers, especially after a lacklustre showing in the downstream market last week. The Indian steel market is sluggish due to lack of demand and fluctuating raw material prices, impacting silico manganese prices too.
  
  
• BIllet prices at 7-month low: SteelMint's domestic steel billet index was at INR 42,300/t exw-Raipur in July, down INR 1,300/t w-o-w. SteelMint's billet index fell to a 7-month low yesterday. This decline in the index is attributed to weak performance in the finished steel sector across the country, leading to reduced demand for billets.
  
  
• Fall in imported manganese ore prices: Imported manganese ore prices in India fell by 2% w-o-w. The price of manganese ore (37%) from South Africa is at around $3.8/dmtu CIF India, as assessed on 1 July. This has also pushed producers to keep manganese alloy prices consistent.
  
  

Outlook

Silico manganese prices may fall moderately in the near term, as domestic demand for manganese alloys remains low while export demand has also decreased.