India: Silico manganese prices increase amid rise in raw material cost

Silico manganese prices are increasing in the domestic market due to rising costs of raw materials and consequent high operating rate of producers.

Moreover, considerable demand for silico manganese is being seen both domestically and internationally, supporting the higher prices.

Furthermore, the domestic market also had to deal with a rise in downstream demand and the challenge of a decline in short-term supply.
As per SteelMint's assessment, Raipur-based producers offered at around INR 83,200/t exw, which rose by 9% w-o-w, while in Durgapur prices were at 81,400/t exw, increasing by 6% w-o-w.
Meanwhile, producers' quotes for grade 60-14 remained at around INR 83,000-84,000/t exw-Raipur. On the other hand, Durgapur producers were seen quoting at INR 80,000/t-82,000/t exw. However, traders offered at around INR 81,500-83,000/t exw in both Raipur and Durgapur amid improving demand.
During the week, SteelMint recorded trade volumes of around 3,500 tonnes (t) of manganese alloys in the domestic market.
Responding to overseas enquiries, exporters offered at around $970/t FOB for 60-14 grade, up by 5% from last week, while prices for the 65-16 grade were assessed at $1,060/t FOB, up 5% w-o-w amid rising export enquiries and a moderate number of deals concluded since last week, which led to the w-o-w rise in prices.
SteelMint recorded trade volumes of around 2,500 t in the export market amid improved demand.

Factors supporting prices

• Raw material prices rise: Prices of imported manganese ore rose somewhat amid increased market activities last week, both domestically and internationally. Australian-origin manganese ore lumps (Mn 46%) are currently valued at $5.6/dmtun CNF Vizag, up 8% w-o-w.
  
  
• Supply-demand mismatch: Material from Indian producers was in high demand in the spot market. Majority of producers are already scheduled for delivery till mid-February, 2023. Additionally, several companies refrained from raising their offers since they anticipate price increases. Silico manganese prices have increased as a result of a scarcity in the local market.
  
  
• Growing domestic steel demand: Last week saw a rise in domestic steel demand, which was accompanied by a number of inquiries and bookings of a few bulk deals, keeping prices on the higher side. SteelMint's daily steel billet index was assessed at INR 47,500 /tonne (t) (up by INR 1,900/ t w-o-w) exw-Raipur on 3 January 2023.
  
  

Outlook
Manganese alloy demand is still strong and India's supply is dropping due to limited production. As a result, silico manganese prices may increase in the near future. Prices might rise even further once export enquiries increase.