Price trend

Last week, the silicomanganese market operated steadily, with prices following the sentiment of the ferrous metals market and showing overall strength, but spot transactions were slow to follow. On the cost side, the manganese ore market consolidated, providing decent cost support; on the production side, there was an expectation of increased output from newly added capacity in Inner Mongolia, while production in Ningxia remained relatively stable; on the steel mill side, steel mills were focusing on meeting immediate needs, and there had been no increase in steel procurement volume. Despite the positive performance of the futures market, steel mills remained cautious in their bidding. According to data from the SunSirs' commodity market analysis system, the market price of silicomanganese (FeMN68Si18) in Ningxia last weekend was around 5,500-5,550 RMB/ton, with an average market price of 5,506.00 RMB/ton, a 0.11% increase compared to the previous week.

Influencing factors

Supply side: Last week, some newly added production capacity in Inner Mongolia, which had been ignited earlier, was about to start producing iron. Recently, another 66,000 KVA large furnace was ignited, and is expected to start producing iron in about half a month. Another factory that was expected to be ignited at the end of the month had been further delayed. Factories had fewer spot offers and mainly focused on fulfilling existing orders. The inventory pressure was not significant. Inventory in Ningxia continued to accumulate, with low shipment volumes and no major fluctuations in production.

In southern China, particularly in the Guangxi region, the electricity tariff policy for next year had not yet been finalized. Factories were still in the cost calculation stage, considering the optimal production model. There was no clear information regarding a reduction in electricity prices in the Xingyi area of Guizhou province. Some factories indicated that electricity prices would likely remain around 0.5 next year, and the production environment remained challenging. The operating rate in Xingyi was poor, with most factories completely shut down.

In the near future, supply pressure is expected to increase rather than decrease. Furnaces in Inner Mongolia that had been previously shut down were gradually resuming production, and some new furnaces recently were ignited. This weakened the positive impact of production cuts at factories in southern China. According to statistics, the operating rate of manganese-silicon enterprises nationwide last week was 36.78%, an increase of 1.17% compared to the week before last; the average daily output was 27,510 tons, an increase of 620 tons.

According to incomplete statistics, as of December 25th, the total inventory of manganese-silicon enterprises nationwide was 387,000 tons, a 2,500-ton increase compared to the previous period. This includes: Inner Mongolia 66,500 tons (a 1,500-ton increase); Ningxia 293,500 tons (a 2,500-ton increase); Guangxi 10,000 tons (a 1,000-ton decrease); Guizhou 7,000 tons (a 1,000-ton increase); Shanxi, Gansu, and Shaanxi 4,000 tons (a 1,000-ton decrease); and Sichuan, Yunnan, and Chongqing 6,000 tons (a 500-ton decrease).

Upstream cost side: Last week, the manganese ore market operated within a narrow range. Buying activity for South African manganese ore increased, with slightly higher transaction volumes and prices; the oxide ore market remained relatively stable. As of December 29, factories had varying levels of oxide ore consumption, with some increasing their use of Australian ore and manganese-rich slag. This had led to a decrease in market activity and average weekly port throughput for Gabonese ore, resulting in slightly weaker prices. Semi-carbonate ore continued to see high consumption. Overall last week, prices for semi-carbonate, medium-grade, and high-grade manganese ores showed upward trends, with high-grade ore with higher manganese content exhibiting a clear price advantage.

Transactions for semi-carbonated manganese ore at Tianjin Port were concluded at 34.5-35 RMB/MTU, with some quotes at 35 RMB/MTU. Due to cost pressures, it was becoming more difficult to sell at lower prices, and some suppliers were unwilling to sell below cost. South African high-grade manganese ore traded at 29.8-30.5 RMB/MTU, with some Mn 33% and above grades quoted at 31 RMB/MTU. South32 Australian ore traded at 41.3-41.5 RMB/MTU, and Gabonese ore traded at around 42.5 RMB/MTU.

At Qinzhou Port, the price of semi-carbonated iron ore varies by grade, ranging from 35-36 RMB/ton.  South African high-grade iron ore was trading at 31 RMB/ton, CML Australian lumps at 42-42.5 RMB/ton, South32 high-grade Australian lumps at 41-41.5 RMB/ton, and high-grade Australian fines at 36.3-36.5 RMB/ton.

In the international market, UMK announced its January 2026 manganese ore price for China, quoting Mn36% South African semi-carbonate manganese ore at $4.15/ton, an increase of $0.05/ton compared to the previous price. NMT also released its January 2026 manganese ore price for China, quoting Mn36% South African semi-carbonate manganese ore at $4.15/ton, an increase of $0.05/ton compared to the previous month's price.

Demand side: Currently, steel mills were still mainly focused on meeting immediate needs, and there has been no increase in steel procurement volume. Despite the relatively strong performance of the market, steel mills remain cautious in their bidding. A steel mill in Jiangxi tendered for ferromanganese at a price of 5,820 RMB/ton, with a purchase volume of 4,000 tons, payable by acceptance draft, including tax and delivery to the factory, with a base price adjustment clause. A certain group tendered for ferromanganese at the following prices: Jiangsu 5,770 RMB/ton; Hubei 5,740 RMB/ton; Anhui 5,800 RMB/ton; Yunfu 5,850 RMB/ton; Heyuan 5,930 RMB/ton, all payable in cash, including tax and delivery to the factory. A steel mill in Guangxi tendered for ferromanganese at a price of 5,780 RMB/ton, with a purchase volume of 15,000 tons, payable in cash, including tax and delivery to the factory.

Market Outlook

Overall, on the cost side, manganese ore prices remained firm, and chemical coke prices are expected to remain relatively stable before the holiday, providing strong overall cost support; on the production side, supply pressure was increasing rather than decreasing, as furnaces in Inner Mongolia that were previously ignited are gradually starting to produce iron, and some new furnaces recently were ignited, weakening the positive support from production cuts in southern factories; on the steel mill side, there was still a tendency to push prices down, and steel mills were facing pressure on profitability and continuously decreasing hot metal production. Sunsirs expects the silicomanganese market to maintain a volatile and wait-and-see stance in the short term, with further developments in steel mill procurement and fluctuations in futures prices needing to be monitored.

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