Silico manganese prices, after coming down are now stable, increasing slightly by range of INR 1,000-2,000/MT. The demand for silico manganese is dented as buyers retreated due to diminishing steel margins.
Domestic Market: After witnessing a downfall, Silico manganese prices are now slightly stable; and increased by INR 1,000-2,000/MT with demand dented as buyers were retreating due to diminishing steel margins. Silico manganese producers are clamoring to offload stock. The Indian ferroalloys producers are reportedly cutting down their Manganese alloy production and would like to exhaust stocks to enable steady cash flows amid thin price margins. Due to cutting down in production of ferro alloys, prices may increase further in a short period.
The manganese alloys market is witnessing sporadic deals and stable prices at the moment. The producers are also facing pressure of lower profit margins, selling close to production cost. It has also been reported that many producers have reduced production due to high input cost and low price of finished goods in the market. Many market participants are of the opinion that cutting down production would support falling manganese alloy prices, as they expect market sentiments to be better in near future. Manganese alloy producers are adopting a cautious approach and are not willing to take strong positions due to various factors. The factors include the demand-supply mismatch of manganese alloys market and the inherent fear about the future prices of manganese alloys, which still remains unclear.
Current Indian SiMn prices may remain the same, only slightly changed at INR 47,500/MT for 60/14% grade and INR 48,000/MT for 60/15% grade, Ex-plant basis at Raipur. In West Bengal, prices are assessed at INR 46,500/MT for 60/14% grade and INR 47,000/MT for 60/15% grade Ex-plant basis at Durgapur. The 70/75 % grade ferro manganese is being traded at INR 47,000/MT in Raipur, due to weak demand. Moreover, there are only few producers in the market. The price levels may slightly change in near future.
Export Market: The producers are quoting/trading export price for SiMn. 60/14% grade SiMn is at USD 730-740/MT, FoB basis. 65/16% grade is trading at about USD 820-830/MT, FoB basis. And, export price of Ferro Manganese with 75% Mn is at about USD 800/MT, FoB basis.
The export prices have been established after export incentive cuts by the government. The prices are being accepted by the buyers. Furthermore, the dollar is expected to be settled at 64. One one hand, Indian producers currently face pressure to sell (export) due to sluggish domestic market conditions. While, on the other hand, it is reported that overseas buyers have no interest for import of Indian origin material because Indian producers are not price competitive compared to Chinese & other counterparts at this time. However, recently, the Government of India announced the FTP; in which it scrapped the FPS and introduced the MEIS reward scheme of 2%. Nevertheless, Indian export market prices are more compared to other foreign players.
On the manganese ore price front, MOIL has reduced prices for Q1 (April-June, 2015) across its products by 20% for silico grade ore and 10% for ferro manganese grade ore. This announcement comes as a relief to manganese alloy industry, which was hopeful of a price cut, as the alloy market has corrected itself considerably in past months. The current price of imported high grade manganese ore is about USD 3.2/DMTU and medium and low grade ore is at USD 3.2/DMTU due to low demand and softening of prices. The industry expects that manganese ore prices would soften again.