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This week, India's silicon manganese export quotation has been increased by $58 per ton. The rising cost of importing manganese ore and the tight domestic supply (delayed delivery, low inventory) are driving up the export price of silicon manganese significantly. Due to changes in global demand and continuous supply chain disruptions, silicon manganese exporters are cautiously seizing this opportunity.
On June 5, 2024, the FOB price of silicon manganese 6014 was $1,121/ton, an increase of $53/ton from last week, and the FOB price of silicon manganese 6516 was $1,238/ton, an increase of $58/ton from last week. In addition, due to the increase in prices of high-quality imported manganese ore and domestically produced manganese ore, some major producers in Vizag and Raible have quoted FOB prices of $1,240-1,250 per ton for 6516 silicon manganese at Vizag and Haldia ports. This also leads to limited supply of high-grade manganese ore.
Factors supporting price increases
High grade manganese ore supply is tight, with prices rising significantly: The high-quality manganese ore market is experiencing a clear period of supply shortage, leading to a continuous increase in manganese ore prices for Indian import traders. Large Australian miner South32 has recently suspended production, exacerbating market concerns about global supply. This interruption has led to supply shortages and pushed up the asking price, especially for immediate delivery of ore to India.
A major importer from Durgapur stated that it is expected that in the short term, the CNF India price of 44% Gabonese manganese ore import will increase by more than $10-12 per ton.
In fact, Indian manganese ore importers are facing the highest historical prices for imported high-quality manganese ore, with prices of these ores rising by $1.3-1.4/dmtu. Overall, manganese ore prices have risen by 18% on a weekly basis.
The production cost of manganese alloy has increased: due to the import price of high-quality manganese ore rising by more than $1.3-1.4/dmtu, the production cost of high-quality manganese alloy in India is expected to increase by 9,000-12,000 rupees per ton ($108-144/ton). This leads to limited immediate supply of manganese alloy, and delivery of new orders may be delayed until July.
The demand for manganese ore in the Chinese market is rapidly increasing: there has been a significant increase in inquiries for high-grade manganese ore in the Chinese market, coupled with limited domestic supply, which has put additional pressure on the global supply chain and affected shipments to Indian ports.
Expectation
In the short term, global manganese ore and domestic manganese ore prices in India are rapidly rising, affecting expectations for the Indian silicon manganese export market. Although the export price of silicon manganese may increase, the long-term impact on the Indian market is still uncertain.
A major importer of Durgapur has stated that it is expected that the import price of Gabonese manganese ore (Mn44%) (CNF India) will soon climb to over $10-12 per ton. The increase in raw material costs may significantly increase the production cost of high-grade manganese alloys.