Weekly round-up: Prices for ferro alloys remain rangebound due to low demand

Ferro alloys prices in the domestic market remained rangebound this week due to limited demand. As a result of mixed sentiments both in domestic and international markets, demand remained soft. The drop in ferro chrome prices was mainly because of weak demand in domestic market at higher levels. Manganese alloys prices inched down this week as domestic steel demand was modest.

Manganese ore

Global manganese ore import prices for Mn: 44-46% fell by 2% w-o-w. Prices of Mn37% grade were at $4.2/dmtu, down by 1%, Mn44% stood at $5.45/dmtu. Mn46% grade was offered at $5.55/dmtu. Low demand for manganese alloys forced production cuts by smelters in the domestic market and contributed to the lowering of manganese ore prices.

IEX Power

According to Indian Energy Exchange (IEX), the weekly average spot prices (09-15 April) in day-ahead-market registered a sharp hike of 52% w-o-w to INR 6.663/unit as against INR INR 4.391/unit last week.

The uptick in electricity transactions was supported by gradual rise in mercury levels which widens the demand-supply gap.

Silico manganese

Prices of silico manganese, exported from Haldia and Vizag ports, dropped by 1% w-o-w. The 60-14 grade remained stable at $934/t, while 65-16 material was offered at $1,030/t, which dropped by 1% w-o-w. As a result of moderate inquiries last week and limited demand from abroad, prices were kept low.

Meanwhile, weekly average prices of silico manganese in the domestic market inched down by 1% w-o-w to INR 75,380/t ex-Durgapur, INR 75,480/t ex-Raipur, down by 1% w-o-w, and INR 76,640/t ex-Vizag, remained stable w-o-w. Low manganese alloy demand forced smelters to cut production in the domestic market and lowered manganese ore prices, which impacted silico manganese prices.

Ferro manganese

Export prices of HC70% ferro manganese remained steady w-o-w to $939/t, down by 1%. Prices of HC75% were at $1,034/t, remained constant w-o-w.

Meanwhile, Domestic ferro manganese prices kept stable w-o-w to INR 77,840/t ex-Durgapur. On the other hand, ex-Raipur prices were stable w-o-w to INR 77,600/t. Prices of ferro manganese remained stable amid muted mixed market sentiment for special steels and the mismatch in supply and demand.

Ferro chrome

According to SteelMint's assessment on 13 April 2023, Indian ferrochrome (HC60%) prices ranged between INR 101,000-102,500/t exw-Jajpur. Ferro chrome prices fell further this week, reaching the lowest level in the past four months. Due to poor market demand, manufacturers were eager to clear their stock at low prices.

The export market was also affected since China, a major importer of ferro chrome, reduced import volume owing to low stainless-steel demand.

The low demand for stainless steel, the current trend is expected to continue in the near future.

Ferro silicon

According to SteelMint's assessment on 14 April, 2023, Guwahati-based producers were offering 70% grade at around INR 119,300/t exw, while Bhutan's offers remained stable at INR 120,000/t exw. Even after low interest from buyers, ferro silicon prices increased by a tiny amount. Price was majorly impacted by electricity supply shortage in the north eastern belt. Particularly in Meghalaya, situation has worsened as its getting only 44% of the required electrical supply.

Production has reduced by 40-50% and as a result, smelters are aiming to hike prices further fearing supply shortage in the near term.

Also, a lower price of around INR 105,405/t FOR was obtained in SAIL's latest auction for 600 t of ferro silicon as a result of the current situation.

Global trends responded favourably as Brazil's exports of ferrosilicon to Japan rose. Prices are expected to increase overall, albeit gradually, as a result of a drop in buying demand.

Trade

SteelMint recorded bulk deals of around 5,300 t of ferro alloys this week. Out of this, manganese deals comprised around 2,500 t, ferro chrome 2,200 t, and ferro silicon around 6,00 t.

Tenders and auctions

• Vedanta's subsidiary, Ferro Alloys Corporation (FACOR), has scheduled an auction for HC ferro chrome of various grades and sizes on 13 April 2023. At the company's last auction on 28 March, both the lots of 10-150 mm fetched an H1 price of INR 108,000/t, which was close to the base price. Ferro chrome prices in Jajpur, Odisha, stood at INR 104,500/t exw on 6 April.
  
  
• China's stainless steel major, Taiyuan Iron and Steel Corporation (TISCO), has decreased ferro chrome (HC 50%) purchase prices by RMB 600/t ($87/t) m-o-m for April 2023 deliveries, sources informed. Effective prices stand at RMB 8,595/t ($1,250/t) DAP, including taxes. The last date of delivery is 30 April.
  
  
• Bharat Heavy Electricals Limited (BHEL) conducted a reverse auction for 10 t of ferro vanadium (V:50% min, low phosphorus, low sulphur) on 12 Apr 2023. The entire material was booked at around INR 1,936,000/t FOR, inclusive of all taxes. Excluding GST and GEM portal charges, prices were at around INR 1,632,515/t FOR, sources informed.
  
  
• South32 has started offering manganese ore for May 2023 shipments. The miner has decreased Australian block (Mn43.5%) offers marginally by $0.45/t dmtu to $5.4/t dmtu amid declining global demand. Meanwhile, offers for South African block (Mn37%) have been kept stable at $4.35/dmtu. All prices are on CIF China basis.
  
  
• Rashtriya Ispat Nigam Limited (RINL) has issued a purchase tender for 1,800 t of high carbon (HC) ferro chrome (Cr: 57-63%, Size: 10-100 mm) for its Vishakapatnam Steel Plant. The last date for submission of bids is 20 April 2023 and the bid offer is valid for 90 days from the end date. SteelMint assessed ferro chrome prices at INR 101,500/t exw-Jajpur on 13 April 2023.
  
  
• Steel Authority of India Limited (SAIL) has scheduled an auction for 600 t of silico manganese from its Chandrapur Ferro Alloy Plant (CFP) on 18 April 2023. Material is available in various grades and sizes which can be procured as per requirement. SteelMint's assessment for silico manganese prices stood at INR 74,700/t exw-Raipur on 14 April 2023.