Indian silico manganese prices hit 5-month low amid panic selling, falling offers
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- Steel mills take cautious approach to procurement
- Downturn in steel prices delay SiMn purchase decisions
Indian domestic silico manganese prices have continued their downtrend, reaching a five-month low amid panic selling and falling offers. This w-o-w decline highlighted the ongoing challenges in the market.
According to BigMint's assessments on 10 September, 2024 prices of grade 60-14 silico manganese dropped significantly by INR 1,000-1,100/tonne (t) ($11-$13/t) w-o-w. The prices for this grade were assessed yesterday at INR 66,000-66,500/t ($786-$792/t) exw, with offers in Raipur ranging from INR 66,500-67,000/t ($792-$799/t) exw.
Confirmed deals (as per BigMint)
Market overview
Smelters face headwinds due to cautious buyers: Steel mills are taking a cautious approach to procurement, opting for need-based purchases amid expectations of further price declines. This strategy, combined with lower offers from traders and instances of panic selling, has added downward pressure on prices.
Furthermore, domestic low-grade manganese ore (Mn37%) prices decreased by INR 2,200/t ($26/t) m-o-m to INR 12,874/t exw ($153/t) for September deliveries, marking a seven-month low due to limited demand for manganese alloys. Imported manganese ore (Mn 37%) prices have hit a 7-month low to $4/dmtu and effective prices, also decreased by $6/t m-o-m to $148/t CNF India.
The decline in manganese ore prices has led buyers to expect further drops in silico manganese prices. However, the current reduction in consumption volume is likely temporary, and market dynamics could shift in the near future.
Competitive offers from nearby regions: Manufacturers in Raigarh are offering material in the range of INR 65,000-65,500/t ($774-780/t), exerting pressure on domestic prices in Raipur. Some other merchants have provided even lower rates, causing buyers to be cautious about accepting higher offers. Nonetheless, key smelters are accepting offers in the range of INR 66,500-67,000/t ($792-$799/t).
Silico manganese exports remain under pressure: BigMint's assessment on 9 September for the 65-16 grade silico manganese (SiMn) remained firm, with prices edging down by $2/t to $928/t FOB, while the 60-14 grade fell by $5/t to $815/t FOB. Major producers in Vizag and Raipur were compelled to keep their 65-16 grade silico manganese prices nearly flat, within an FOB range of $930-$935/t, due to weak overseas demand. Despite global market challenges, Indian silico manganese export prices have remained relatively stable. Key factors contributing to this trend include subdued overseas demand, limited alternative sources, and existing contractual commitments.
Billet prices drop w-o-w: BigMint's steel billet index, a key benchmark in India, witnessed a significant decline of INR 650/t to INR 37,400/t ($446/t) exw-Raipur on 11 September. The downturn in the steel market is creating a cascading effect on silico manganese prices. As steel producers reduce their demand for ferro alloys, including silico manganese, prices are expected to face downward pressure.
Outlook
The Indian domestic silico manganese market is expected to face downward pressure in the near-term. Weak export demand, competition from other regions, and declining imported ore prices are likely to contribute to a slight decline in prices.
