China: Silico manganese prices ease as cost support limits downside

• Cost pressures intensify amid weak market sentiment
  
  
• Steel mills sustain downward pressure on prices
  
  

Chinese silico manganese prices (Mn 65%, Si 17%) remained steady with a slight correction of RMB 50/t ($7/t) w-o-w to RMB 5,620-5,960/t ($830 -889/t) exw in the week ended 15 June 2026.

The silico manganese market remained trapped in a persistent downward cycle, with weakening futures dragging spot prices lower and steel mill tenders stalled. Amid abundant supply, subdued demand, and mounting cost pressures, market sentiment continues to deteriorate despite expectations that prices are nearing a short-term bottom.

Market updates

Cost pressures reinforce market floor dynamics: The cost structure of silico manganese remains under significant strain, with manganese ore, chemical coke, power, and auxiliary materials continuing to shape production economics. While manganese ore prices appear stable, transaction levels have softened, and rising chemical coke costs are sharply compressing smelter margins. Power costs remain elevated, particularly in southern regions, limiting production recovery. With spot prices hovering close to full-cost levels, producers are increasingly dependent on long-term contracts, reinforcing the likelihood of production cuts if prices fall further.

Additionally, Jupiter has announced its July 2026 manganese ore offer to China, setting South African semi-carbonated lump ore (Mn 36.5%) at $4.70/dmtu, a decrease of $0.10/dmtu from June, reflecting a softer pricing stance amid weakening downstream market conditions.

Steel mills maintain strong pricing pressure: Silico manganese demand remained supported by steady crude steel and hot metal production, but procurement behavior has shifted decisively in favor of steel mills. Buyers continue to adopt cautious, small-batch purchasing strategies while aggressively pushing for lower prices. Recent tender settlements across several regions confirmed further price declines, reinforcing mills bargaining power. Although consumption remains stable, downstream participants are avoiding inventory buildup and maintaining a persistent price-suppression stance.

Outlook

Chinese silico manganese market is nearing a bottom, but a meaningful recovery remains dependent on upcoming steel mill tender prices. Cost support from coke, manganese ore, and tightening producer margins should limit further downside. However, sustained improvement will require supply reductions and renewed steel mill restocking, keeping the market range-bound in the short term.

(With inputs from CBC)