SunSirs: Supply and Demand Were Weakly Balanced, and the Silicomanganese Market Was Operating in a Consolidation Trend

Price trend

The silicomanganese market saw a period of consolidation last week, with steel bids declining month-on-month and market sentiment weak. Southern mills were primarily focused on delivering previous orders, with few new orders. Some northern mills, citing poor profits, mostly closed their bids, with transactions primarily based on basis trading, with most being delivered to existing orders. Data from the SunSirs commodity market analysis system showed that the market price for silicomanganese (FeMN68Si18) in Ningxia last weekend was around 5,500-5,600 RMB/ton, with an average price of 5,580.00 RMB/ton, a slight increase of 0.18% from the beginning of the week.

Influencing factors

Supply side: Some factories that resumed production in Inner Mongolia were expected to produce iron last week, while other factories were still under maintenance due to furnace and market reasons. The overall output was expected to fluctuate slightly. In terms of new production capacity, it is unlikely that it will actually be put into production this month, and most of them will be put into production in November. As of October 24, production operations in Ningxia remained stable, and some factories that were overhauled in the early stage havd resumed production. Affected by market demand, the shipment rhythm of manufacturers had slowed down, and the inventory within the factory was at a high level.

In the southern region, the overall market operation was relatively stable. After some manufacturers in Guangxi switched to producing high manganese in the early stage and large factories in Guizhou were fully loaded, it is expected that the operation of silicomanganese will fluctuate limitedly this month. After November, under the influence of higher electricity prices in the south, the operation will decline and the spot price of silicomanganese will gradually tighten.

According to statistics, the operating rate of silicomanganese enterprises across the country last week was 43.04%, a decrease of 0.24% from the previous week; the average daily output was 29,630 tons, a decrease of 200 tons.

As of October 24, according to incomplete statistics, the national inventory of silicomanganese enterprises was 293,000 tons, a month-on-month increase of 30,500 tons. Among them, Inner Mongolia had 43,500 tons, a month-on-month increase of 500 tons; Ningxia had 217,000 tons, a month-on-month increase of 27,500 tons; Guangxi had 10,000 tons, unchanged; Guizhou had 7,000 tons, a month-on-month increase of 1,000 tons; (Shanxi, Gansu, and Shaanxi) had 7,000 tons, a month-on-month increase of 1,000 tons; (Sichuan, Yunnan, and Chongqing) had 8,500 tons, a month-on-month increase of 500 tons.

Upstream Costs: The manganese ore market experienced volatility last week, with quotations slightly rising and pending transactions. Semi-carbonate ore at Tianjin Port was quoted at 34.5 RMB/MTU, with transactions around 34 RMB/MTU. South African high-speed rail ore was trading around 30 RMB/MTU, while Gabon ore was trading between 39.5-40 RMB/MTU. Australian block sub-index prices were between 39-40.5 RMB/MTU. Manganese ore spot prices at Qinzhou Port were mixed, with South African ore prices consolidating at a high level. Continued arrivals of Australian seed ore put pressure on spot prices, leading to a slight decline in prices. Market prices were volatile, with Australian seed ore priced at 34-35.5 RMB/MTU and semi-carbonate ore at 37-37.5 RMB/MTU.

Jupiter only announced the price of fine ore in the November overseas market, and had not yet made lump ore offers to China. UMK had not made any semi-carbonic acid ore offers to Tianjin Port. The market expects that the arrival volume and inventory of semi-carbonic acid ore will be reduced before the Spring Festival. South African inventory was in short supply at Qinzhou Port. The market sentiment for futures acceptance was good. The price gap with the north may gradually narrow in the future. The price of high-quality oxide ore lump was relatively strong.

On the demand side: HBIS Group's final October silicomanganese price was 5,820 RMB/ton, with the first round of inquiries reaching 5,750 RMB/ton and the second round priced at 5,800 RMB/ton. The September silicomanganese price was 6,000 RMB/ton (the October 2024 price was 6,200 RMB/ton). silicomanganese production was 16,500 tons. September production was 17,000 tons (October 2024 production was 12,000 tons).

A certain group was bidding for 4,500 tons of 6517 silicomanganese blocks, with prices set at 5,730 RMB/ton for 1,500 tons in Jiangsu, 5,770 RMB/ton for 2,200 tons in Yunfu, Guangdong, and 5,840 RMB/ton for 800 tons in Heyuan, Guangdong. All prices were in cash on delivery, including tax. A steel mill in East China was purchasing 1,700 tons of silicomanganese alloy at 5,800 RMB/ton, with acceptance tax included, ex-factory. A steel mill in Jiangsu was bidding for silicomanganese alloy at 5,820 RMB/ton, with acceptance tax included, ex-factory.

Market Forecast:

On the whole, the silicomanganese market was in a weak balance between supply and demand, with limited cost support and bearish market sentiment. SunSirs expects the silicomanganese market to maintain consolidation in the short term.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.