Some improvement in China’s domestic common alloys market

Over the past week China's common alloy market has improved compared with the previous period. The domestic manganese alloy market has started to rebound after several consecutive months of sluggishness, and currently inquiries have increased in the market; meanwhile, producers have also raised their ex-works prices. At the same time, the ferrosilicon market has seen a slight upward trend, and the number of ferrosilicon producers which have suspended production operations has increased.

In the past week, the prices of manganese alloys have risen slightly. Currently, market quotations of FeMn65Si17 are at RMB 7,600-7,800/mt ($1,118-1,152/mt) in the north of China, and are priced at RMB 7,400-7,600/mt ($1,088-1,123/mt) in the south of the country, increasing by RMB 50-100/mt ($7-15/mt) week on week. At the same time, the mainstream price of FeMn65 stands at around RMB 7,500/mt ($1,108/mt). Meanwhile, export offers of FeMn65Si17 are standing at $1,450/mt FOB.

China's manganese alloy market has gradually started to rebound after several consecutive months of sluggishness. Because of low prices, manganese alloy producers were making small profits or incurring losses, and so many enterprises have suspended production, causing a reduction in supply. Of late, supply in the market has been on the short side; meanwhile, due to the increase in the number of inquiries, most manganese alloy producers have slightly raised their ex-works quotations. In addition, domestic steel mills have begun to make purchases in order to replenish their reduced inventories. While a slight improvement has been seen in the domestic manganese alloy market, further observation is required before an overall rebound can be spoken of.

In the domestic ferrosilicon market, quotations have seen a slight upward trend. Current ex-works prices of ferrosilicon (75 percent) in the northwestern region stand at RMB 6,350-6,450/mt ($935-950/mt), with the lower end up by RMB 50/mt ($7/mt) week on week, while export offers of ferrosilicon (75 percent) have remained at $1,350/mt FOB.

Characterized by a slight upward trend, the transaction situation in the domestic ferrosilicon market has not been so good. Most market players are not optimistic about the prospects for the market in the future and they think there is insufficient momentum to drive the current increase. At the same time, the number of ferrosilicon enterprises which have suspended production has risen significantly, due to the high cost of electricity. Recently, some producers in Gansu, Qinghai and Ningxia have also chosen to stop production.