How Will Higher Raw Materials Impact Indian Silico Manganese Market?

Prices of silico manganese in the Indian markets are expected to remain supported, according to industry participants. Silico Manganese is a high-value-added product used for the manufacturing of mild and special steel. It is manufactured and supplied in various shapes to steel manufacturers.

The high cost of domestic and imported manganese ore is likely to influence producers to keep prices higher amidst supply shortages, OfBusiness assessed after discussion with industry experts.

Rising Manganese Ore Prices to Support Silico Manganese Prices

According to reports, prices of imported manganese ore have risen by 14-15%. Also, domestic ore prices have jumped by 25-40% m-o-m. These higher input costs have lowered the margins of silico producers and are forcing them to keep prices higher even though the bid prices are lower from steel mills.

Apart from manganese ore price surge, shortage of ore is expected to grow, as producers are holding their offers. They are playing safe with prices following Eramet’s highlight of an increase in manganese ore prices in the coming month.

French mining company Eramet is the largest manganese ore producer from Gabon. The company expects to benefit from a significant increase in global ore prices this year due to the prolonged halt in high-grade exports from South32’s Australian mine.

For China Eramet has announced its June shipment prices with the price for Gabonese lump ore of 44.5% manganese content increasing significantly by $2/dmtu. Limited mine supply, along with China’s reduction of stockpiles, have bolstered manganese ore prices.

Overall the higher ore prices amidst supply shortage, reduction in inventories of manganese ore in China and expected surge in manganese ore prices to further support Indian silico manganese prices.

Higher Steel Prices Keep Demand Active for Silico Manganese

Strong steel prices in the Indian steel market is another major factor that indicates less scope for silico manganese prices cut.

Since the Indian steel market is performing well, the demand from steel mills for silico manganese remained active even though the prices are record high.

According to the assessments, steel including billet prices in India surged by Rs 1,000-1,500/ton week-on-week and around Rs 4,000-5,000/ton month-on-month basis.

Prices of Silico Manganese (HC 60-14)

• Prices of silico manganese in Raipur are at around Rs 95,000-95,500/ton, up by Rs 1,000-2,000/ton week-on-week and about Rs 25,000/ton month-on-month basis.

• Prices of silico manganese in Durgapur are at about Rs 93,000-93,500/ton, up by Rs 1,000-1,500/ton week-on-week and about Rs 23,000-24,000/ton month-on-month basis.

Market Outlook for Silico Manganese Industry

Considering the above factors of high input costs and a further surge in manganese ore prices globally seems to further support the silico manganese market in India.

Also, since the supply of silico manganese in the domestic market is not up to the mark, any major price contractions in the short term are less likely.

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