SunSirs: Silicomanganese Market Was Stronger Last Week

Price trend

Last week, silicomanganese futures prices continued to fluctuate and strengthen. Sentiment in the cost-side manganese ore market had increased, with trading volumes gradually following suit. Following a 50 RMB/ton drop in chemical coke prices, expectations of further increases were emerging. Furthermore, driven by steelmaking activity, downstream inquiries had increased, making it difficult to source at low prices. Prices for some demand-driven products had followed suit, and with steelmaking activity rebounding, confidence in the silicomanganese market had further improved. Data from the SunSirs Commodity Market Analysis System indicated that last weekend's silicomanganese market quotes in Ningxia (specification FeMN68Si18) were around 5,730-5,770 RMB/ton, with an average price of 5,760.00 RMB/ton, up 1.44% from the beginning of the week.

Influencing factors

On the supply side, production at Inner Mongolia factories saw minimal fluctuations last week. Some factories previously undergoing maintenance were temporarily undergoing ongoing overhaul. Some new high-silicon silicomanganese production capacity is expected to start up at the end of this month or early next month. Some standard silicon production is slated to begin in October, with some delays, though these are brief. Operations at Ningxia factories remained stable, and manufacturer order delivery cycles were nearing completion.

Production in southern China had seen minimal fluctuations, with most factories maintaining their operations. A major factory in Guizhou province planned to resume production in the second half of the month, with potential room for output growth. However, some factories planned to halt production until the end of September, and their specific production schedules remained under investigation. Manufacturers in Yunnan province indicated that electricity prices will increase after October, potentially impacting the full capacity utilization rates.

According to statistics, the operating rate of silicomanganese enterprises across the country last week was 45.68%, a decrease of 1.70% from the previous week; the average daily output was 29,825 tons, a decrease of 765 tons.

Upstream Costs: The manganese ore market remained strong last week, with factory stocking activity improving. Traders maintained a supportive price stance, leading to an overall transaction price increase of approximately 0.3-0.5 RMB/tonne/kWh. Data showed that at Tianjin Port, Australian manganese ore blocks were temproarily priced at 40-42 RMB/tonne/kWh, semi-carbonate blocks at 34-35 RMB/tonne/kWh, and Gabon blocks at 40-40.5 RMB/tonne/kWh. At Qinzhou Port, Australian manganese ore blocks were priced at 40-41.5 RMB/tonne/kWh, semi-carbonate blocks at 36.5-37 RMB/tonne/kWh, and Gabon blocks at 40.5 RMB/tonne/kWh.

On the international market, Jupiter's October semi-carbonic acid price would be $4.05/ton, unchanged from the previous month. Market acceptance was normal, and according to market feedback, this shipment was a single cargo, with a relatively low volume. Recent shipments remained stable, with a large vessel dispatched from Gabon. This will not significantly impact port arrivals for the time being. Southern factories were primarily purchasing on demand, with stocking expected to begin next week. Manganese ore inventories at Qinzhou Port had been declining recently, providing some support for prices. Arrivals are expected to remain stable in the future.

On the demand side: A large steel mill in North China had finalized the September bidding price of silicomanganese alloy to be 6,000 RMB/ton, which was 200 RMB/ton higher than the inquiry price and 200 RMB/ton lower than the August price; the purchase quantity this time was 17,000 tons, an increase of 900 tons from August.

A Yunnan steel mill was pricing silicomanganese at 5,820 RMB/ton, bidding for 1,500 tons, in cash including taxa and delivered to the factory. A Hubei steel mill as pricing silicomanganese at 5,930 RMB/ton, bidding for 7,500 tons, with acceptanc, including tax and delivered to the factory. A Guangdong steel mill was pricing silicomanganese at 5,950 RMB/ton, bidding for 500 tons, with acceptance, including tax and delivered to the factory, with a discount.

Market outlook

On the whole, the manganese ore market was rising on the cost side and is expected to be positive. At the same time, driven by the steel recruitment atmosphere, the enthusiasm of downstream inquiries increased. SunSirs expects that the silicomanganese market may continue to fluctuate and strengthen in the short term.

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