Silicomanganese Futures rebounded in shock, and the difficulty of spot price increase is still there. The price pressure sentiment of June steel bidding is strong, and the market inquiry atmosphere is acceptable. On the cost side, the price of manganese ore consolidated, and the price of chemical coke continued to fall slightly this week. The alloy cost support was general, and there was no obvious positive support in the market. The overall performance was weak. It has now fallen below the cost line in the north. The factory has a low willingness to ship, and most of them are closed and not reported. The delivery of existing orders is mainly to wait and see the market trend.

According to the data from the commodity market analysis system of SunSirs, the market price of silicomanganese in Ningxia (specification FeMN68Si18) was around 5430-5550 RMB/ton last weekend, and the market average price was 5536.00 RMB/ton, which was slightly higher than the beginning of the week by 0.29%.

1. Influencing factors

Supply side: This week, the start-up of factories in Inner Mongolia did not fluctuate much. Most manufacturers said that they had no intention to reduce production at present and maintained a wait-and-see attitude. Some factories that resumed production in the early stage are expected to continue to increase slightly in production. Ningxia still maintains a low level, and the intention to continue to reduce production in the short term has slowed down. The settlement electricity price in Ningxia in May will increase by about 2 cents on the basis of April, and there will be electricity transactions in June and July, and the electricity price is expected to fall.

In June, the progress of increasing production and resuming production in Yunnan is relatively slow. Under the continuous decline of the market, the wait-and-see sentiment of the factory is relatively strong, and the output has increased slightly. It is expected that the start-up rate will continue to rise in July. Most factories in Guizhou are in a state of suspension and have no intention to start. The incremental electricity fee discount in Guilin has been reduced, and the factory is considering suspension of production. The start-up rate is expected to fluctuate slightly.

According to statistics, the operating rate of manganese silicon enterprises nationwide this week was 35.03%, an increase of 0.26% from last week; the average daily output was 24,555 tons, an increase of 280 tons. The output of silicomanganese has increased slightly, mainly concentrated in Inner Mongolia and Guilin. In the later period, the new production in Inner Mongolia may be carried out one after another. Ningxia is a trading month in June, and there is an expectation of a reduction in electricity prices. It is difficult for the output in the north to decline.

According to incomplete statistics, as of June 6, the inventory of ferromanganese enterprises nationwide was 186,600 tons, a decrease of 14,500 tons from the previous month. Among them, Inner Mongolia had 46,300 tons, a decrease of 2,500 tons from the previous month; Ningxia had 122,000 tons, a decrease of 2,000 tons from the previous month; Guangxi had 3,000 tons, a decrease of 3,500 tons from the previous month; Guizhou had 5,000 tons, a decrease of 2,500 tons from the previous month; (Shanxi, Gansu, Shaanxi) had 6,300 tons, unchanged; (Sichuan, Yunnan, Chongqing) had 4,000 tons, a decrease of 4,000 tons from the previous month.

Upstream cost side: South Africa's high-iron manganese ore has recently arrived at the port in an increased amount and inventory has increased. In addition, the reduction in the start-up of manganese-rich slag in the north has put pressure on demand, and the transaction price has fallen slightly; South32 Australian ore arrived at the port this week, and the oxide ore may face increased price competition pressure, but the arrival of Gabon manganese ore has decreased this month, and the cost of oxide ore arriving at the port this month is mostly 5.1-5.4 US dollars/ton degree, with a large inversion, traders are less willing to give discounts, and the market has limited low-priced supply in the short term.

Data shows that the current price of manganese ore Australian block in Tianjin Port is 41 RMB/ton degree, semi-carbonate is 33-33.5 RMB/ton degree, and Gabon block is 36-36.5 RMB/ton degree; the price of manganese ore Australian block in Qinzhou Port is 41-41.5 RMB/ton degree, semi-carbonate is 33.5-34 RMB/ton degree, and Gabon block is 39 RMB/ton degree.

In market news, Gabonese President Brissé Origi Nguema said in a government statement released on Saturday that Gabon will stop exporting manganese ore from 2029 as part of the national industrial transformation plan.

Demand: A steel plant in Fujian priced silicomanganese at 5,446 RMB/ton, the tender quantity was 11,000 tons, half cash and half acceptance, and the basis was discounted; a steel plant in East China priced silicomanganese at 5,550 RMB/ton, the tender quantity was 6,500 tons, and the acceptance was tax-inclusive to the factory.

2. Market Forecast

On the whole, the pace of production reduction and suspension in silicomanganese producing areas has been temporarily slowed down, and factors such as electricity prices may lead to an increase in production in some areas, but the off-season effect suppresses terminal demand. At present, the downstream still has a clear willingness to lower prices for silicomanganese purchases.

SunSirs expects that the manganese silicon market may continue to fluctuate weakly and narrowly in the short term, and it is still necessary to wait and see the changes brought to the market by the subsequent news progress.

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