Trade Resources Industry Views Platts Assessed 99.7% Manganese at $2,170-2,220/Mt FOB China Thursday

Platts Assessed 99.7% Manganese at $2,170-2,220/Mt FOB China Thursday

Electrolytic manganese metal prices remained stable for two consecutive weeks as a fall in spot supply balanced waning demand from international buyers.

Platts assessed 99.7% manganese at $2,170-2,220/mt FOB China Thursday, unchanged from the previous week.

Tycoon Manganese Group, a major producer based in Shenzhen, sold over 240 mt of electrolytic manganese metal to Japanese buyers at around $2,180/mt FOB China this week, a company source said.

China's third-largest electrolytic manganese metal producer, Hongxin Group, did not sell any spot material this week but indicated tradable prices at around $2,200/mt FOB China.

Market opinion was split on the tradable price level for the ferroalloy.

A trading source in Xi'an noted that there was a slowdown in buying interest from Chinese steelmakers who were heard to be scaling back on their alloys purchase as they cut their crude steel output.

Over 80% of Chinese electrolytic manganese metal output is for the domestic market.

"There is little motivation for Chinese steelmakers to buy electrolytic manganese metal when the steel price is on a decline and many were now cutting back on their steel output. This eventually pressurized price for the export market too," said the Xi'an trader. "Besides, I am not seeing many interested overseas buyers this week, and this also pushed down prices of electrolytic manganese metal too."

Meanwhile, industry sources pegged the domestic price in a wider range of Yuan 12,500-13,000/mt ($2,050-2,131/mt), down from the Yuan 13,000/mt level the week before.

China's average daily crude steel output over December 21-31, 2013, was estimated at 1.961 million mt, down 2.7% from mid-December's 2.014 million mt/d, according to an estimate released earlier by the China Iron & Steel Association.

Taking into account the latest data, China's daily crude steel output averaged 1.995 million mt/d over the whole of December, down 6% from November's 2.122 million mt/d.

The spot price of square billet in Tangshan, the steelmaking hub of China, was Yuan 2,920/mt Thursday, down Yuan 90/mt from December 16, Platts records show.

But other market participants said that despite a slowdown in overseas demand, the electrolytic manganese metal market was supported by tight spot availability.

A company source with Hongxin Group said that it was scaling back on output now as its workers need to go home for Chinese lunar new year holiday from January 25, and would come back to work only after February 9.

The privately-owned producer added that most spot buyers would not be seeking any cargoes as they had already restocked well ahead until mid February and that explained the dip in spot demand this week.

"We were producing at less than 20% of our output capacity now, a large drop from 35% a month ago," said the company source at Hongxin group. "Tighter spot supply serves to balance the fall in demand and serves to support the spot market this week."

Electrolytic manganese is commonly used as an alloy agent for steel production. China is the biggest producer of electrolytic manganese metal in the world.

Source: http://news.chemnet.com/Chemical-News/detail-2232332.html
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China Manganese: Price Steady as Less Supply Meets Lower Demand
Topics: Metallurgy