SHANGHAI, Jan. 4(SMM) -- Today, mainstream traded prices of EMM were in the RMB 14,500-14,600/mt range. Although transactions were relatively sluggish, most producers believed prices would rise in the future.
According to SMM sources, there are two reasons behind the expectation of price increases. Firstly, raw material costs are expected to climb. It is reported, EMM producers are busy replenishing raw material stocks, and prices of raw materials like ore powder and sulfuric acid already stabilize at high levels. If EMM producers increase purchase volumes, upward momentum of raw material prices will be more obvious. Secondly, purchasing volumes from downstream consumers are expected to increase. Downstream steel mills will begin to replenish stock gradually before the Chinese New Year holiday, which will bring a round of purchase volumes to EMM market. Meanwhile, middlemen will also make small amount of purchase volumes before the Chinese New Year holiday.
SMM believes EMM prices will advance along with higher costs of raw materials and increased demand from downstream consumers, but rising prices trend still rely on trading volumes. If trading volumes increase, prices may climb further, if trading volumes reduce, prices may be hard to advance.
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