Weekly round-up: Ferro alloys market subdued amid higher inventories

Indian ferro alloys market saw negative sentiments with lower volumes traded this week. Manganese alloys supplies exceeded demand, which led to a downward correction in its prices.

Manganese ore
Global manganese ore imports were down w-o-w owing to reduction in ferro alloys production in China. Imports prices for 37% grade were also down by 4% w-o-w at around $4.8/dmtu, while 44% grade and 46% grade prices were down by 6% to $6.7/dmtu and $7.55/dmtu respectively. Overall, the manganese ore market was muted due to pressure from the alloys market.

IEX power prices
Spot electricity prices at Indian Energy Exchange (IEX) remained range bound at INR 4-6/unit as power demand slowed down during the monsoon. The average price in day-ahead-market this week (17-23 July) was assessed at INR 5.69/unit as against INR 4.8/unit in the previous week.

Silico manganese
Exported silico manganese (60-14 grade) prices were down $28/t w-o-w to $1,007/t and 65-16 grade was down $31/t to $1,122/t at Indian ports due to low demand. This decrease in exports price was driven by fluctuation in raw material prices and lower demand in abroad countries.

Meanwhile, domestic silico manganese prices fell in key markets. Prices were assessed at INR 78,260/t ex-Durgapur, INR 77,880/t ex-Vizag and INR 79,920/t ex-Raipur on a weekly basis. Higher inventory in domestic market and lower steel demand dragged down silico manganese prices.

Ferro manganese
Ferro manganese export prices were dropped w-o-w owing to lower demand in stainless and special steel market. Weekly average prices for HC 70% were down by $34/t at $1,052/t, while prices of HC 75% grade dropped by $70/t to $1,122/t.

Meanwhile, domestic ferro manganese prices fell by INR 1,770/t w-o-w INR 82,890/t ex-Durgapur and by INR 540/t to INR 87,460/t ex-Raipur.

Ferro chrome
Ferro chrome smelters were offering at around INR 102,300/t exw-Jajpur on 21 July, down by INR 1,200/t w-o-w to close deals amid slow buying. Prices reached 6-month lows owing to muted domestic demand as majority of buyers were in wait-and-watch mode, anticipating further price declines. Moreover, China’s export demand was also subdued as the currency depreciation weighed on the imported market.

Ferro silicon
Indian ferro silicon prices fell by INR 4,550/t w-o-w to INR 146,100/t exw-Guwahati and prices from Bhutan dropped by INR 2,200/t to INR 146,100/t exw. This week, buyers negotiated hard as buyers were cautious about booking the material at higher prices amid bearish steel and ferro alloys market.

Deals
SteelMint recorded around 17,500 t of bulk ferro alloys deals this week, out of which manganese alloys deals accounted for 13,300 t, ferro chrome for 2,200 t, and ferro silicon for 2,000 t.

Tenders and auctions

• State-run miner OMC concluded a 54,400 t chrome ore auction on 18 July. Out of the total quantity, only 13,500 t (25%) was booked at the base price. Higher grade material (Cr2O3: 54%) was booked by chemical manufacturers while 52-54% grade was booked by alloy producers to blend with low grade ore.
  
  
• SAIL's Bokaro Steel Plant (BSL) booked 100 t of HC ferro chrome (HC60%) was at around INR 118,100/t inclusive of all charges through reverse auction conducted on 12 July.
  
  
• Odisha-based manganese alloys producer Adhunik Metaliks Limited sold 300 t of silico manganese (Mn:59.5% & below) at INR 76,400/t and 115 t (similar grade material) at INR 74,600/t on an ex-works basis through auction conducted on 19 July. Meanwhile, 126 t of ferro manganese was booked at INR 69,550/t exw, sources informed.
  
  
• Vedanta's subsidiary Ferro Alloys Corporation Limited (FACOR) scheduled an auction for different grades of chrome ore fines and concentrates on 21 July.
  
  
• Sandur Mines (SMIORE) scheduled an auction for 41,832 t of manganese ore of different grades (Mn:26- 35%) on 29 July.