Chinese common alloys market sees stable movement

China's domestic common alloys market remained stable at low levels in the past week, but with increased inquiries observed in the market.

As regards manganese alloys, against the stable market movement in the past week, certain improvements have been seen in commercial activity, while some producers have made slight hikes to their ex-factory prices. At present, market quotations of silicon manganese FeMn65Si17 are in the range of RMB 6,600-6,900/mt ($966-1,010/mt); meanwhile, mainstream prices of high carbon ferromanganese FeMn65 have remained unchanged at RMB 6,800-7,000/mt ($996-1,026/mt). In addition, China's export market for silicon manganese and other manganese alloys was generally characterized by stagnancy.

In recent days, few changes have been observed in manganese alloy prices in the various regions. Some northern-based manganese alloy producers report that they have received many orders and inquiries; however, the mills' purchase prices still remain at low levels. Although many silicon manganese producers have registered active sales performances, their profit margins are quite slim due to the high production costs. In the south, in spite of relatively low production costs, producers failed to see the briskness in sales that was observed in the northern regions. Looking at the current situation, the Chinese silicon manganese alloys market is moving on a positive trend, but a big rally is unlikely in the short term.

With regard to ferrosilicon, China's domestic market retained its stability throughout the past week. At present, the ex-factory prices of ferrosilicon (75 percent) in the northwestern regions have remained in the range of RMB 5,300-5,400/mt ($776-791/mt), while domestic ferrosilicon is now offered at around $1,050-1,100/mt FOB for the export market. The market performance continues to be sluggish.

With electricity prices remaining high in the Ningxia and Neimenggu regions, many producers have continued the suspension of their operations, while those still operating find themselves coming under great pressure. Although mills have made successive purchases in recent days, their purchase prices have remained at low levels. It is said that new adjustments will be made to electricity prices in the various regions; however, the mills still seem pessimistic as regards the future. In addition, the export market has been characterized by slackness in recent days, and this is also one of the reasons for the continuous bearishness in the domestic ferrosilicon market.