FOCUS: Stronger silico-manganese market will protect manganese ore price crash if stocks are liquidated

Improving demand from manganese alloy smelters is likely to help protect the ore market from a sharp downward correction in the event a liquidation of port stocks, market sources told Fastmarkets.

Manganese ore stocks in Chinese ports stand at 3.85-3.93 million tonnes, according to Fastmarkets’ latest assessment, after they rose to 4.09-4.18 million tonnes early in June - their highest since the assessment was launched in 2017. Real availability is tighter than it appears because traders and consumers would make a loss if they sold or consumed material that was purchased at higher prices than today. Their reluctance to part with material leads to so-called “frozen stocks” in Chinese ports. Large volumes of the material held in Chinese ports was bought in March and April when low-grade prices were trading between $6.08 and $6.22 per dry metric tonne unit (dmtu) on a cif basis, sources said. Fastmarkets’ 37% manganese ore index, cif Tianjin rose 4 cents to $5.30 per dmtu on Friday June 28, having been under pressure since April due to deteriorating sentiment, which is largely linked to the high stocks...

Published

Janie Davies

Susan Zou

Jon Stibbs

June 28, 2019

17:46 GMT

London, Shanghai