SunSirs: Manganese Ore Demand is still Good, and Silicomanganese Prices have Risen slightly

Last week, as manganese ore prices continue to be maintained and factories continue to deliver to the market and downstream, the sentiment for low-price shipments is not strong, but the release of terminal demand is weak, the contradiction between silicon and manganese supply and demand has not been substantially improved, and steel mills have limited acceptance of high prices for silicon and manganese. The prices of some steel bids have risen moderately. According to the data from the commodity market analysis system of SunSirs, the market price of silicon and manganese in Ningxia (specification FeMN68Si18) was around 5550-5600 RMB/ton last weekend, and the average market price was 5576.00 RMB/ton, a slight increase of 0.22% compared with the beginning of last week.

1. Influencing factors

Supply side: This week, the start-up of factories in Inner Mongolia did not fluctuate much, and some factories maintained reduced production for maintenance. There is no expectation of new production capacity this month, and it is expected to be put into production at the end of the third quarter to the fourth quarter. The start-up in the northwest region is basically stable, and the expectation of reduced production and suspension in the later period will not fluctuate much.

The operating rate in the southern region continues to be low. A large factory in Guizhou has completely stopped production this week, with a significant drop in output, and there is no plan to resume production in the short term. Currently, most of the factories that resume production are single-shift production at night, and the overall output is low. Most factories in Guilin, Guangxi have stopped production recently, waiting for the introduction of a new round of electricity tariff preferential policies, and will decide on production plans based on the situation. Yunnan's production has gradually recovered, and its cost advantage during the flood season is more obvious.

According to statistics, the operating rate of manganese silicon enterprises nationwide this week was 40.34%, an increase of 1.13% from last week; the average daily output was 25,730 tons, an increase of 125 tons.

According to incomplete statistics, as of July 4, the inventory of manganese silicon enterprises nationwide was 222,300 tons, an increase of 500 tons from the previous month. Among them, Inner Mongolia had 54,000 tons, a decrease of 1,000 tons from the previous month; Ningxia had 145,000 tons, an increase of 5,000 tons from the previous month; Guangxi had 6,000 tons, a decrease of 500 tons from the previous month; Guizhou had 4,000 tons, a decrease of 1,000 tons from the previous month; (Shanxi, Gansu, Shaanxi) had 6,300 tons, unchanged; (Sichuan, Yunnan, Chongqing) had 7,000 tons, a decrease of 2,000 tons from the previous month.

Upstream cost side: The market price of manganese ore has been firm and upward recently. With the rebound of silicon manganese futures, traders have gradually reduced their shipments at low prices, and the difficulty of bargaining for factories has further increased. The overall transaction price has increased by about 0.5 RMB/ton, and the quotation is still in the process of exploration.

From the perspective of manganese ore shipment, the mainstream ore in Tianjin Port has maintained a constant shipment recently. There is less pressure to arrive at the port in July. It may face the pressure of concentrated oxide ore arriving at the port at the end of July and the beginning of August. However, the downstream factories are currently very enthusiastic about starting work, and the demand for manganese ore remains high. There is no possibility of a sharp increase in manganese ore inventory for the time being, and the contradiction between supply and demand of manganese ore is relatively small.

Recently, 15,000 tons of Comilau Gabon arrived at Qinzhou Port, and the remaining 35,000 tons were sent to Tianjin Port. Most of the Gabon cargo of this ship is in the hands of the factory. Recently, many factories have stopped furnaces, and the factory is shipping. This week, 3 Australian ships arrived at the port in succession, 2 ships of south32 and 1 ship of United Mining, and then sent to Tianjin Port. The Australian inventory increased this week.

Recently, the price of manganese ore has been supported by the downstream wait-and-see sentiment, and the transaction progress is still slow, but the price-supporting sentiment of manganese miners is still strong. Data shows that the current price of manganese ore Australian block in Tianjin Port is 39.5-41 RMB/ton, semi-carbonic acid is 34-34.5 RMB/ton, and Gabon block is 38.5 RMB/ton; the price of manganese ore Australian block in Qinzhou Port is 39.5-40.5 RMB/ton, semi-carbonic acid is 34 RMB/ton, and Gabon block is 39.5-40 RMB/ton.

Demand: Recently, the price of steel bidding in East China has risen slightly, and the price is around 5720-5770 acceptance, and the price-supporting mentality of suppliers has gradually risen.

A steel plant in Jiangxi bid for silicon manganese alloy at 5720 RMB/ton, the quantity is 4,000 tons, the acceptance is tax-inclusive to the factory, and there is a discount basis.

It is reported that the price of a new round of silicon manganese bidding and procurement by a certain group has increased, among which the price for Hubei is 5720 RMB/ton for 1900 tons; the price for Jiangsu is 5740 RMB/ton for 500 tons; the price for Anhui is 5740 RMB/ton for 500 tons; the price for Yunfu is 5770 RMB/ton for 1700 tons; the price for HeRMB is 5820 RMB/ton for 500 tons; all of the above are cash prices including tax.

2. Market Forecast

On the whole, the price of manganese ore is consolidating, the price of chemical coke has not fluctuated for the time being, and the overall alloy cost support is still acceptable; in addition, silicon manganese enterprises have been incurring losses for a long time, which has increased the difficulty faced by downstream enterprises in price-pressing inquiries; but the demand side has not yet shown an unexpected willingness to replenish silicon manganese stocks, and the uncertainty at the macro level still exists, so the industry remains cautious. SunSirs expects that the manganese silicon market may continue to consolidate in a narrow range in the short term, and pay attention to the price fluctuations on the futures market.

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