Indian silico manganese offers remain under pressure on falling steel prices

This week witnessed further decline in Indian silico manganese prices, as lack of global demand and excess supply in the domestic market exerted pressure on prices.

According to SteelMint's assessment, silico manganese prices in Raipur were at INR 65,700/t exw, down INR 500/t w-o-w, which was the same two months ago on 2 August. Meanwhile, prices in Vizag were at INR 66,100/t exw, down INR 400/t w-o-w. Manufacturers' offers in Durgapur dropped INR 1,000/t in the previous week to INR 64,500/t exw.

Producers' quotes for grade 60-14 decreased slightly to around INR 65,000-66,000/t exw in Durgapur, Raipur, and Vizag. However, traders' offers were slightly lower at INR 64,000-64,500/t exw in all three locations amid declining bulk enquiries. This week, SteelMint recorded trade volumes of around 3,700 t of manganese alloys in the domestic market, down 1,500t from last week.

Factors impacting prices

Muted enquiries from overseas: Muted enquiries from overseas also impacted domestic silico manganese prices, as it is a export centric commodity with around 50% of domestic production being channelled to the export market. Moreover, Malaysia has the most competitive offers on the market now compared with other countries due to cheaper electricity costs, with current offers ranging from $830-850/t FOB for 65-16 grade. This, too, put pressure on Indian silico prices, sources informed.

Falling steel prices: Domestic billet prices fell by INR 350-500/t last week, further impacting trade in semis as a result of the general decline in finished steel inquiries from key nations. Silico manganese prices decreased as a result of lower trade volumes and fewer enquiries. SteelMint's steel billet index stood at INR 42,500/t ex-Raipur on 17 October, down INR 500/t.

Outlook
The silico spot market will continue to fluctuate. However, prices are projected to rise due to diminishing domestic ore supplies and rising costs of raw materials such as coking coal.