Indian silico manganese prices rise to 1-month high on production cuts, rising steel prices

Rising supply constraints amidst production cuts in major producing regions along with rising steel prices have caused sellers to hike silico manganese offers. Prices have increased by about INR 600/t exw in the last one week.

According to SteelMint's estimate, the price of silico manganese in Raipur was INR 63,500/t exw, up INR 600/t w-o-w. Durgapur had a 500/t increase in prices, reaching INR 62,600/t exw. Vizag's pricing increased by INR 500/t as well, to INR 63,800/t.

Factors influencing domestic prices

Supply shortages: Furthermore, Raipur, which accounts for 40% of manganese alloy manufacturing, has recently seen production cuts. As per sources, around 30-40MVA of furnaces have been planned for maintenance in central India, which has a production loss of around 4,000-5,000t per month. Also, many significant producers in Raipur and Vizag were sold till the middle of January 2024, and they are no longer active in selling in the retail domestic market. Due to mounting supply shortages, many sellers have booked advance material to avoid spot inventory concerns. This caused the price to soar even further.

Increase in steel billet prices: Last week, as domestic steel demand lifted and there were few booking inquiries, silico manganese prices gained support and increased a bit. Meanwhile, semi-finished steel prices continued to increase over the weekend. SteelMint's IF steel billet index was at INR 41,000/t on December 12, up INR 1,000/t ex-Raipur.

Suppliers are optimistic about the global market outlook: Manufacturers are hesitant to reduce their prices because they have received fair inquiries from the export market, particularly in Europe. The European market recently reopened for material consumption, and manufacturers are seeking reasonable prices for bulk deals from India. This is driven by the anticipation of further price increases for materials due to supply shortages.

Outlook

In the near future, silico manganese prices may rise due to increased inquiries from the European region and other key importing countries, which may generate suitable demand, boosting prices even further. However, focus should be placed on demand and supply volumes both within the country and from importing countries abroad.

Additionally, market participants anticipate that starting in mid-January, prices will be higher since demand will be stronger than usual after the market's opening following the Christmas and New Year's holidays.href="https://www.steelmintevents.com/2nd-india-steel-and-metal-conference-supply-chain-sourcing-strategies/">