SHANGHAI, Feb. 20 (SMM) – Major steel plants are raising steel prices at present due to high production cost and market optimism. Many steel plants increased ex-work prices for March, boosting market expectation over their 1Q profits. Domestic steel enterprises which can barely maintain meager profit through 2012 are likely to reverse losses temporarily in 1Q.

Silicomanganese alloy market, however, remained stable as manganese ore prices kept strong. Electricity prices and coke prices remained highs. Railway transportation fee was raised by nearly 13% for 1 mt of silicomanganese alloy per kilometer, much higher than market anticipated. Hence, silicomanganese alloy suffered more production costs.

SMM believes that steel industry is still facing challenges now. If steel demand can not improve following the Chinese New Year holiday, silicomanganese alloy prices will be depressed. Nevertheless, considering high production cost at silicomanganese alloy producers, silicomanganese alloy prices will probably fluctuate at current levels for the foreseeable future.

Mainstream quotes for silicomanganese alloy today: