RE: RE: Worth the price on manganese operations alChinese manganese alloy prices continue remarkable rise
BEIJING(Metal-Pages) 4-Aug-09. Chinese manganese alloy prices have seen a leapagain in the past week as domestic steel mills have accepted payinghigher purchase prices and manganese ore prices continue to surge.
Prices for 65/17 grade silico-manganese are at Rmb 7,900-8,400/tonne ($1,158-1,232 before 20% export tax) depending on delivery terms, up some 5% from last week’s level of Rmb 7,600-8,000/tonne.
“China’s steel industry is running pretty well so steel mills havebeen extending their output and have accepted higher purchase prices ofraw materials for this month’s requirements,” said a manganese alloyproducer.
Hebei Iron and Steel Group, China’s second largest steelmaker, isreported to be tendering for 38,000 tonnes of silico-manganese at Rmb 7,950/tonne ($1,166) basis delivered to works, up Rmb 550/tonne as compared to their purchase price in July, market sources said.
Elsewhere, another major mill Wuhan Iron and Steel Group is reported to have increased its purchase price to Rmb 7,800/tonne delivered, up Rmb 1,100/tonne from their last round of purchasing, while Shougang Group and Baogang Group also have accepted paying Rmb 7,950/tonne and Rmb 8,050/tonne ($1,180) delivered respectively, up Rmb 1,000/tonne from their last intake.
As Metal-Pages reported, China’s apparent consumption of crude steel isestimated to reach a record 510-540 million tonnes in 2009, up12.8-19.7% on a year-on-year basis, according to the China Iron andSteel Association (CISA).
“China’s Rmb 4 trillion stimulus package has boosted demand forsteel in housing construction and infrastructures such as railways,highways and airports etc,” said a CISA official.
The surging price for manganese ores is once again cited as another supportive factor for the rally.
“There remains a shortage in spot material and strong demand fromalloy producers so the tightness is not expected to ease soon,” an oredealer said.
Spot prices for 44-46% imported lumpy ores are at Rmb 55-60/mtu($8.06-8.79/mtu duty paid), up some 9% as compared to last week’slevel. In the past month manganese ore prices have surged more than50%, according to Metal-Pages pricing archive.
With soaring domestic prices and recovering foreign demand, theexport market has picked up with prices for 65/17 gradesilico-manganese moving up to a range of $ 1,400-1,500/tonne FOB, up $ 50.
“We have got more enquiries than last month but are worried that theremarkable increase in domestic prices and manganese ore costs willhinder the export trade as foreign consumers may be scared away if theprice rise becomes unreasonable,” said an export trader.
China’s exports of silico-manganese hit a multi-year low of 50,039tonnes in the first half of this year, compared to 457,813 tonnes inthe same period of 2008.
Meanwhile, the market for ferro-manganese has strengthened in linewith better demand and higher costs, with prices for high carbonmaterial with 65% Mn content edging up to Rmb 7,100-7,400/tonne ($1,041-1,085 before 20% export tax) ex works from Rmb 6,700-7,100/tonne. Exports of high carbon ferro-manganese with 75% Mn grade are being quoted at $ 1,400-1,500/tonne FOB.
China’s exports of ferro-manganese were also as low as 22,525 tonnesin the first half of this year, down sharply from 205,316 tonnesexported in the same period of 2008.