India: Silico manganese prices increase on better exports demand

• Increase in exports inquiries.
  
  
• Higher international prices for silico manganese.
  
  
• Major producers booked up to next month.
  
  
• West Bengal under lockdown.
  
  
• Future pricing remains ambiguous.
  
  

Indian silico manganese prices are rebounding amidst better demand from the export market. Many producers have secured bulk orders from the European buyers.
Meanwhile, inquiries from South East and the Middle East have picked up.
Prices in the European markets increased amidst production cuts and higher demand from steel mills. They are willing to procure and stock inventory for the upcoming quarter owing to the ongoing crisis of containers and vessels. However, most of the Indian exporters remained booked till next month and cannot offer any quantity for June shipments. Most of the exporters are now offering for July-August shipments.

The merchant exporters are now booking material from the domestic producers, which has also bolstered pricing dynamics. Meanwhile, major domestic smelters are catering to the previously booked government tenders.

Current export prices have increased by a hefty $50/tonne amidst the appreciating Indian rupee against the US dollar and increasing prices from the international market.
SteelMint learnt that few deals were concluded at $1,250/t for the 60-14 grade and at around $1,350/t for the 65-16 grade. In the domestic market, prices are ruling at around INR 89,000-89,500/t exw for both Raipur and Durgapur.

Although many producers are also offering at INR 90,000/t ex-Raipur and up to INR 92,000/t in Durgapur, not many deals were recorded at such high prices. In Raipur, a good number of deals were recorded at INR 89,000/t and in Durgapur, in the range of INR 89,000-89,500/t.
In the domestic market, intra-state dispatches are largely affected with West Bengal under lockdown. Although the production of ferro alloys is not restricted in the lockdown, many producers reported that they are facing severe labour shortage, especially for low-semi skilled jobs. There are increased cases of absenteeism and many people are getting infected at various plants. This is creating a hurdle for the breaking and sizing of ferro alloys. Thus, many plants are holding their offers in Durgapur and are waiting for the lockdown to ease a little. Till then they are dispatching limited quantities to previously booked orders of high priority.

However, things may stabilise in the coming days. Logistics has been a concern since the onset of the second wave and the subsequent lockdown in the state. Currently, producers from West Bengal are reporting issues of truck availability.

Although the market seems strong, there is a growing sense of ambiguity. Many producers feel that the falling finished and semi-finished steel market might dent demand as mills may resist booking raw material at such high prices.

Meanwhile, another set of producers remains optimistic that the prices might cross the INR 92,000/t-mark if the supply crunch continues and the export market remains supportive.