China’s manganese alloys market remains soft

Still characterized by sluggishness, China's domestic manganese alloys market again slipped by a small step over the past week against the generally pessimistic market atmosphere. Meanwhile, the Chinese ferrosilicon market moved stable, accompanied with the increased demand.

As regards manganese alloys, domestic market continued its weak performance throughout the past week, while market prices in the south seemed much lower than the northern prices. At present, market quotations of silicon manganese FeMn65Si17 in the southern regions are in the range of RMB 6,400-6,700/mt ($938-982/mt); while mainstream prices in the north are standing at RMB 6,700-6,900/mt ($982-1,012/mt). Meanwhile, mainstream prices of high carbon ferromanganese FeMn65 have declined RMB 100/mt ($15/mt) to RMB 6,500-6,900/mt ($953-1,012/mt).

Currently, China's domestic ferroalloy producers and manganese ore traders are anticipating a sharp fall in the quotations of Australian manganese ore for the third quarter, while mills have again lowered their purchase prices for manganese alloys - which are the main reasons for the recent continuous decline in prices of silicon manganese and other ferromanganese products. It is estimated by some market players that the negotiation price of Australian manganese lump ore (44 percent) for the third quarter will be around $3.5-3.8/mtu, equivalent to RMB 30-33/mtu ($4.4-4.8/mtu) at the Chinese ports, far below the present market levels. Therefore, quotations of manganese ore at the ports continued to decline in recent days, accompanied with the slowed trading performance. In addition, Chinese mills also reduced their purchase prices over the past week, with the mainstream purchase prices down to RMB 6,500-6,600/mt ($953-967/mt).

With regard to ferrosilicon, China's domestic market went stable in the past week. At present, the ex-factory prices of ferrosilicon (75 percent) in the northwestern regions are in the range of RMB 5,200-5,300/mt ($762-777/mt), while domestic ferrosilicon is still offered at around $1,050-1,100/mt FOB for the export market, with few deals concluded.

China's domestic ferrosilicon market moved stable at low levels throughout the past week, accompanied with increased deals and inquiries, but no change observed in overall market quotation levels. Looking at the current situation, due to the improved production at downstream mills, market has observed increased purchases, but the purchase prices still maintain at low levels. In addition, restricted by the high production costs, most ferrosilicon producers in Neimenggu regions still keep halts to the operations.