India: Silico manganese prices rise on improved spot demand
India’s silico manganese prices, which had been under pressure for a couple of weeks due to muted demand, have now shown an uptrend on improved buying interest....
India's silico manganese prices, which had been under pressure for a couple of weeks due to muted demand, have now shown an uptrend on improved buying interest.
According to SteelMint's assessment on 28 Dec'21, silico manganese (60-14) prices are at INR 95,150/tonnes(t) exw-Durgapur and at INR 96,250/t exw-Raipur. Overall, deals have been concluded in the range of INR 95,000-97,000/t exw - from both Durgapur and Raipur locations, these being two key producing hubs in India.
The beginning of the week saw an increase in the number of enquiries, trade sources informed SteelMint.
What led to the rebound in silico manganese prices?
- Domestic demand for silico manganese has increased since the start of the current week. Steel makers who have been in wait-and-watch mode, on expectation of falling prices, have begun to book the material. This has led to robust demand in the spot market. And, producers did not miss out on the opporunity by slightly raising their offer after closing each transaction.
- A rise in finished long steel prices due to good buying has also encouraged silico manganese producers to raise prices.
- Exports also increased, mainly from South-East Asia, Far East, and Middle-East. A majority of exporters are sold out for Jan'22 shipments, so they are now offering 60-14 grades at $1,290-1,300/t FOB India for shipments from Feb-Mar'22. In comparison, offers from producers of the 65-16 grade are between $1,440-1,445/t FOB India whereas suppliers are reducing their prices by $10-20/t to close deals and some are ready to sell at $1,410/t FOB India.
China market overview
There has been a slight uptick of RMB 50-100/t ($8-16/t) in prices in the Chinese market this week, with both 60-14 and 65-17 grades being offered at RMB 7,200-8,025/t ($1,130-1,260/t) exw. But, despite this hike in some regions, purchase prices of downstream steel mills have not increased substantially.
Moreover, majority of the steel mills have stepped up efforts to curb production, to co-incide with the Winter Olympics. Steel mills traditionally store lesser volumes in winter, and thus procurements of silico manganese have dipped. As a result, prices from Guizhou fell by RMB 100/t ($16/t) to roughly RMB 7,450-8,425/t ($1,170-1,323/t) exw for both 60-14 and 65-17 grades.
Outlook
Silico manganese prices are likely to remain firm as buyers from Europe are expected to make a comeback after the winter holidays.