China: Silico Manganese prices inched down w-o-w amid sluggish demand

Weak demand dampens silico manganese prices

Rising manganese ore supply fosters market caution

CBC: Chinese silico manganese (Mn: 65%, Si: 17%) prices inching down by RMB 150/t ($21/t) w-o-w to RMB 5,630-5,900/t ($778-$815/t) exw, including taxes.

Silicomanganese prices remained subdued as demand slowed, and market activity became more cautious. Production cuts in regions like Guangxi and Guizhou, alongside reduced steel mill output and shrinking profits, continue to pressure prices and limit transaction volumes.

Market recap:

Steel prices fell amid competition: Silico manganese production and maintenance in key regions surpassed expectations, the average daily output saw a sharp decline compared to the previous week, signalling an accelerated pace of supply-side contraction.

On the demand front, reduced blast furnace operations and a strategic shift by certain steel mills toward higher scrap usage and lower alloy consumption have further dampened silicomanganese demand. Meanwhile, steel procurement prices continued to fall amid intensified market competition. The market is expected to remain volatile in the short term.

Manganese ore supply curbs market pace: The manganese ore market is experiencing intensified supply pressure following the resumption of output from South32's Australian operations and a surge in shipments from Gabonese mines.

While market prices have remained relatively stable, the growing supply has led to a cautious trading atmosphere. Participants hold mixed views, and overall transaction levels remain light. Manganese ore prices continue to offer a steady cost support for silicomanganese alloys

In the short term, the market is expected to remain in a consolidation phase, with attention focused on producer procurement activity and port destocking dynamics.

Downstream market hampered by sluggish demand: Factories are holding back from high price offers due to subdued downstream demand. Industry insiders are adopting a more cautious stance. currently, the market is in its traditional off-season, resulting in a limited supply of alloys.

Additionally, power rationing and off-peak production policies in Inner Mongolia and Ningxia continue to significantly affect silicomanganese alloy output. As a result, the market outlook for silicomanganese remains pessimistic.

Outlook: The silicomanganese market will likely remain weak due to high inventory levels, subdued demand, and continued cost pressures. However, prices may fluctuate if manganese ore costs rise in the future.