Chinese electrolytic manganese metal prices fell this week, with most steel mills retreating from the spot market following weeks of restocking, sources said
Platts assessed 99.7% manganese at $2,160-2,210/mt FOB China Thursday, down $30/mt or 1.4% from the previous week. Meanwhile, industry sources pegged the domestic price of electrolytic manganese at Yuan 12,800/mt ($2,088/mt) this week, down Yuan 200/mt or 1.5% from the previous week.
Several producer sources noted that electrolytic manganese metal demand has ebbed, following the highs seen in mid-September, with the majority of steel mills having completed their restocking activities earlier this month.
Hongxin Group, a major producer based in Hubei province, had already started to invite bids for December-delivery cargoes last week, after selling out its November-delivery cargoes last month. However, a source at Hongxin said Thursday that the company has yet to receive any spot bids from international buyers for December-delivery.
"Although there is muted buying appetite from international buyers on the spot market, we still have about 1,000 mt of contractual orders to fulfil each month," said the Hongxin source, adding that demand in the domestic Chinese market continues to be robust.
A Shaanxi-based trader, meanwhile, noted that the domestic Chinese market tends to set the price direction for the international spot market.
"With Chinese steel mills as the largest consumer of electrolytic manganese metal, most manganese metal producers would usually look to the domestic market as an indicator for price movements," he said.
China is the largest manganese electrolytic metal producer in the world.
Meanwhile, Tycoon Manganese -- which is based in South China's Shenzhen province -- sold about 240 mt of manganese metal to Japanese buyers at $2,180/mt FOB China this week. In addition, the company sold about 800 mt of manganese metal at Yuan 12,900/mt in the domestic market.
Tycoon has an annual electrolytic manganese metal production capacity of 50,000 mt. But starting next May, the company will start up a new electric arc furnace in Yunnan, taking its annual production output to 150,000 mt, the source said.
"We have our own captive carbonated manganese ore mine as well as our own hydroelectric power, so we aim to capitalize on these two assets to raise our annual output," said the source.
But he added that the run rates at the new furnace would very much depend on how the Chinese economy fares next year.
Meanwhile, according to market sources, Ningxia Tianyuan Manganese -- China's largest producer of electrolytic manganese metal -- has yet to start up a new 150,000 mt/year electric arc furnace. The company was initially planning to bring the unit online in October, sources said.
Further details are not known and Ningxia Tianyuan Manganese could not be reached for comment Thursday. The company currently produces about 200,000 mt/year of electrolytic manganese metal, according to market sources.
Electrolytic manganese is commonly used as an alloy agent for steel production.
