FOCUS: ‘Frozen stocks’ of manganese ore in China almost gone, sources say

“Frozen stocks” of manganese ore that previously sat at Chinese ports have thawed after suppliers’ average costs decreased as a result of them booking cheaper cargoes late last year against the backdrop of a buoyed port market since November, sources told Fastmarkets.

The volumes of frozen stocks were seen to have diminished in 2020 compared with a year earlier, and today, there is little sign of them at the ports.
Fastmarkets examines how these stocks became unfrozen and what increased tradeable material at Chinese ports means for the manganese market.
Frozen stocks generally refer to cargoes held at ports that owners, traders or alloy smelters are reluctant to sell or consume because doing so will make them incur severe financial losses, market sources said.
Basically, when the purchasing cost is higher than port prices by 20% - the usual amount required as an upfront deposit related to the value of a cargo that some buyers who desire to buy but have no right to open a letter of credit pay companies to help them do so and pay the balance on arrival – some stocks will become ‘frozen’.
Costs averaged out

The main reason...

Published

Siyi Liu

March 12, 2021

07:20 GMT

Shanghai