Indian Silicon Manganese Industry Faces Constant Price Drop; Suppliers Worry

The Indian Silicon Manganese Industry has been facing a constant drop in prices since January 2023. This has led to concerns among suppliers who are worried about the impact of this trend on their future orders. With significant price corrections, the prices are hitting their lowest in 2023. In this article, we will discuss the reasons for this trend and prospects for the industry.

Why Constant Price Drop?

• Price And Demand- One of the main reasons prices drop is the poor demand from domestic steel mills. This has put pressure on silicon manganese prices, as most smelters and traders have sufficient stock on their premises for at least the next one to two weeks. The negative price trend has led them to hold future orders in a wait-and-watch mode.

• Lack Of Fresh Export Deals-Secondly, the absence of fresh export deals has contributed to the downtrend in prices. The world’s largest steel producer, China, has also witnessed a downtrend in manganese ore prices, with prices hitting a five-month low on thin demand. This has ultimately kept trends negative on global markets.

• Liquidity Crisis- Thirdly, a few Indian participants believe that a liquidity crisis at the closing of the fiscal year has pushed major stockists to keep their buying on hold to close their books healthily.

Price Movements

• Silicon Manganese- The current prices for silicon manganese (HC 60-14) have fallen by approximately Rs 1,500/ton week-on-week to Rs 72,000-73,000/ton ex-works in Raipur and Durgapur, excluding GST. A few suppliers have mentioned that they can adjust these offers as per the buying interest, indicating that trade discounts are available despite lower offers after a constant drop.

• Export Prices- Following the negative global market, the Indian export prices have also dropped by around $40-50/ton in a week, with fresh offers reported at nearly $880-885/ton FOB India.

• Steel Prices- In addition, Indian steel prices, especially mid-sized mills, have slashed their prices by around Rs 1,000/ton week-on-week.

Insight

Prices are anticipated to stabilize at the onset of the fiscal year, but until then, there may be a continued correction due to sufficient stock with suppliers. This surplus could create pressure on prices. In the event of a significant decline, silicon manganese producers may reduce production to restore equilibrium in the supply-demand chain.

Read more: Mid-Sized Mills’ TMT Market Notices Positive Trend After Continuous Fall