Market Pessimism Eased Somewhat, but Wait-and-See Sentiment Still Dominates [SMM SiMn Weekly Review]

As of this Friday, SiMn 6517 (cash) in the north China market was at 5,700-5,750 yuan/mt, flat WoW from last Friday; SiMn 6517 (cash) in south China was at 5,750-5,800 yuan/mt, flat WoW; SiMn 6014 (cash) in south China was at 5,350-5,450 yuan/mt, flat WoW.

Recently, SiMn futures have been consolidating on a strong note and drifting higher. The pessimistic sentiment in the market has somewhat faded, but wait-and-see sentiment still dominates.

Cost side: On the ore side, manganese ore spot prices saw relatively small changes; on the electricity price side, electricity prices in Guangxi and Guizhou stay high with no expevtations of a decline. Yunnan entered the rainy season, with electricity prices somewhat lowered. In Inner Mongolia, during the low wind season, some areas experienced power rationing, leading to a slight increase in electricity prices.Under the interplay of multiple factors, the comprehensive production cost of SiMn has descreased somewhat.

Supply side: Operating rates in Inner Mongolia were relatively stable, but most producers reportd heavy losses and signifiant production pressure. In Ningxia, producers saw deepening losses, continuing last month's production cuts and output reduction, with low operating rates. South China showed divergenc: Yunnan alloy plants saw relatively notable cost reductions due to lower electricity prices during the rainy season, leading to incresed operating rates. In other parts of south China, overall operating rates remained low, with few shipment opportunitits and a sluggish market trading atmospher.Overall industry supply has declined, while finished product inventries at enterprises remained high. The high destocking pressure still exerts some downward pressure on SiMn futures and spot prices in the short term.

Demand side: End-use consumption of alloys was sluggish, with overall downstream procurment sentiment weak. Steel mills and traders were cautius in restocking, making it difficult to effectively boost the SiMn market in the short term. Steel mill tenders entred the market one after another. HBIS priced SiMn at 5,880 yuan/mt for August 2026, only 80 yuan/mtu higher than the initial inquiry price of 5,800 yuan/mt, representing a signifiant push for lower prices compared to the July price of 5,950 yuan/mt. The procurement volume was 16,600 mt. The current steel tender pricing had a relatively small boosting effect on the market,market sentiment for shipments remained cautius.

Overall, current demand can hardly effectively boost prices. Producers are generally loss-making with high production pressure. Under a loose sumply-demand balance, SiMn will consolidat in the short term, with the market still dominatd by wait-and-see sentiment.