This Is How Indian Silico Manganese Market Affected By Soft Demand

Silico Manganese (SM) is a crucial component in Steelmaking and lately, the Indian SM market has been facing pressure. The demand has been weak, and buyers are looking for lower offers due to the declining Steel prices and sluggish global market trends. Even though there has been a drop in prices, the demand remains insufficient, and stock levels are more than the average maintained by the producers, industry sources reported to Ofbusiness.

In this article, we will explore more about the current scenario of the Indian SM industry in depth.

Current Market Scenario

• Domestic Prices- The current Silico manganese (HC 60-14) offers in both Raipur and Durgapur are around Rs 73,000/ton ex-works through the producers’ end. Resellers’ offers are cheaper by Rs 500-1,000/ton. The domestic market remains weak due to the soft demand and the buyers’ reluctance to pay higher Silico Manganese prices in India.

• Export Prices- Silico Manganese (HC70, 65-16) export offers floated at around $980-1,000/ton FOB, but demand remained weak due to no major inquiries and global buyers are waiting for lower offers. The export market is also facing challenges due to sluggish demand and the buyers are not interested to pay higher Silico Manganese prices in India.

• Stock Remains Sufficient- There is an ample supply of SM in the market, which is more than the average maintained by the producers as almost all plants are operational despite low demand. The supply is expected to remain sufficient as the demand is expected to be slow due to seasonal low production of Ingot and billet and falling Steel prices globally, including China, which accounts for more than 50% of the world’s total Steel production.

• Manganese Ore Prices And Their Impact- Manganese Ore (India) Limited (MOIL), the largest producer of Manganese ore in India, has slashed the prices for May 2023 by 4%-5% to compete with import offers. MOIL operates 11 mines in adjoining districts of Madhya Pradesh and Maharashtra. The declining prices had a direct impact on Silico Manganese’s prices. The prices of raw materials are softening globally, which is putting pressure on Silico Manganese prices.

Market Outlook

Considering the factors of mismatch in demand-supply, seasonal low productivity of Steel (Ingot and Billet) mills, softening raw material and Steel prices globally, there are fewer chances of significant price improvement in the SM industry. However, sharp price corrections are also limited, and there may be slight changes in prices in the short-term outlook.

OFB’s Insight

The Indian Silico Manganese market is under pressure due to weak demand and softening raw material and Steel prices globally. The stock levels remain sufficient, and the chances of significant price improvement are low. While there may be slight changes in prices for the short-term outlook, the market is expected to remain subdued until the demand picks up, or there is a significant change in the market trends globally.

Read more: Why Is Indian Flat Steel Market Slow?

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