SMM Weekly Forecast on China EMM Market

SHANGHAI, Mar. 25 (SMM) -- SMM believes that demand from stainless steel mills and alloy producers will continue to grow. Meanwhile, operating rates at EMM producers will remain at low level. In this context, EMM prices are expected to be on upward track and may grow to RMB 19,700/mt given the growing demand and high production costs.

Demand:

Based on result of SMM survey at EMM producers in Jiangsu, Zhejiang and Guangdong provinces, most #200 stainless steel mills reported stable orders. According to SMM sources, most stainless steel mills adopted a wait-and-see attitude when EMM prices were high in March, and they largely consumed previous inventories. As they gradually received April's orders, they have to replenish stock. In this context, EMM demand will be active in the following week. In addition, alloy producers also have need for EMM as they have received orders.

Supply:

Operating rates were still low at EMM producers in Xiangxi due to tight supply of manganese ore. Given that supply of China's manganese carbonate ore is largely from Xiangxi region, ore supply shortage in Xiangxi strongly supports EMM prices throughout China. In addition, pries of selenium dioxide also advanced. Prices of sulphuric acid were stable, and power prices haven't shown decline sign. All these factors will support EMM production costs and will in turn support EMM prices as well. 

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