China’s manganese alloys market remains bearish

Over the past week the Chinese manganese alloys market continued its sliding movement against the background of weakened market demand and decreased prices of raw materials. Meanwhile, the domestic ferrosilicon market posted a general stability, with no improvement seen in overall trading activity.

China's domestic manganese alloys market maintained its slow decline over the past week. At present, market quotations of silicon manganese FeMn65Si17 are in the range of RMB 7,300-7,800/mt ($1,069-1,142/mt) in the southern regions, though some producers have lowered their quotations to RMB 7,200/mt ($1,054/mt) - marking an overall average decrease of RMB 200/mt ($29/mt) week on week. Meanwhile, mainstream prices of high carbon ferromanganese FeMn65 in the south have remained constant at RMB 7,200-7,400/mt ($1,054-1,083/mt).

In recent days, the reduced alloy purchases made by various mills and the decreased prices of manganese ore have been the main factors contributing to the continuous decline in the Chinese manganese alloys market. As a result of the bearish movement in the domestic finished steel market, most steel mills have had to cut their ferroalloy purchases and to lower their purchase prices by a certain margin. Thus, with few new orders received by various ferroalloy producers recently, the domestic ferroalloy market has registered an overall sluggishness in its trading performance. In addition, market quotations of manganese ore have slid further down in the past week. Currently, market quotations of Australian manganese ore (44 percent lump) at Qinzhou port are down by RMB 2/mtu to the level of RMB 54/mtu ($9/mtu). Looking at the current situation, the Chinese manganese alloys market is expected to remain on its weak trend, with improvement unlikely in the short term.

With regard to ferrosilicon, the Chinese domestic market has become relatively stable throughout the past week, with market quotations remaining at the previous levels in the various regions. The ex-factory prices of ferrosilicon (75 percent) in the northwestern regions are in the range of RMB 5,500-5,600/mt ($805-820/mt), while domestic ferrosilicon is still offered at around $1,180-1,200/mt FOB for the export market.

China's domestic ferrosilicon market generally moved on a stable trend over the past week, but with no obvious improvement seen in market trading. In this context, the Chinese ferrosilicon producers have only posted a minor increase in their inventories compared with the levels of the previous week, with most producers merely producing in order to meet orders previously received. As regards the coming week, the domestic ferrosilicon market is expected to show stable movement on the whole, with some confusion possible as regards the quotations of certain producers.