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[SMM analysis] Manganese ore entered the "three high" market health to be adjusted from January to June 2019.
Jul 12,2019 17:07CST
The content below was translated by Tencent automatically for reference.

In 2019, the domestic imported manganese ore market is not compared with the downstream silicon and manganese market twists and turns, but smoothly all the way down, traders since late April began to appear sustained losses, the market lamented, a small number of second-hand traders have to leave gloomily, can not help but wonder: is the manganese mine market sick? In this regard, SMM summed up the following three reasons:

1. China's strong demand for imported manganese mines and weak bargaining power have attracted the attention of other mainstream mines overseas. Sustained imports may lead to a small surplus in supply, but because of the strong bargaining power of overseas mines, the high pursuit of profits makes the quotation to China has been at a high level, and the cost pressure of traders is greater.

Second, in the past three years, the total inventory of imported manganese mine ports in June this year reached an all-time high, strong inventory led to the imbalance between supply and demand, but also led to the weakening of the bargaining power of traders;

Third, high-pressure competition, under the general circumstances of the overall economic environment, the phenomenon of traders throwing goods at low prices appears from time to time; at the same time, under the continuous concern of the domestic manganese mine market, the import volume of non-mainstream minerals such as Zambia, Senegal, Kenya, Mozambique and so on has slowly increased, which to a certain extent has impacted the market supply pattern.

Under the "three high" symptoms of high cost, high inventory and high pressure, the broken window effect of the market gradually appears, even if the downstream alloy demand improves obviously in May and June this year, the rising trend of port manganese mine price is still slightly weak, and the comprehensive profit space is still general.

In the first quarter of this year, Tianjin Port imported a total of 5.544 million tons of manganese ore, Qinzhou Port imported about 876000 tons of manganese ore, and other ports about 360000 tons, an increase of 55.8 percent and 63.6 percent respectively in batches and weights over the same period last year. Imports of bulk manganese ore continued to grow, and imports reached an all-time high.

Then (554.4 87.6 36) 3 2034

That is, the supply of imported manganese ore in 2019 is about 20.34 million tons.

In the second quarter of this year, the total amount of manganese ore imported in China is expected to be about 8.97 million tons, with a total of about 15.75 million tons in the first half of this year.

1575 2150

That is, the supply of imported manganese ore in 2019 is about 31.5 million tons.

The total amount of manganese ore imported in 2018 was 27.7075 million tons, compared with 21.2586 million tons in 2017, an increase of 644.89 tons over the previous year, an increase of 30.33 percent over the same period last year. The average monthly import volume increased by 537400 tons, and the amount of manganese ore imported in 2019 is expected to increase by 3.7925 million tons over 2018, an increase of 13.69 percent over the same period last year. Although the growth rate has slowed, it is still facing an oversupply of manganese ore and may gradually intensify.

In 2017, the silicon and manganese industry is going through the adjustment stage, the environmental protection policy compresses the production capacity of silicon and manganese manufacturers, the silicon and manganese market fluctuates in the first half of 2018, and ushered in a "bull market" in the second half of the year. On the one hand, some of the production capacity of environmental protection inspection and withdrawal has led to a partial gap in the spot market. Therefore, from June 2018, manganese ore imports began to increase gradually; At the same time, the new rebar standard, which came into effect in November, has increased the consumption coefficient of silicon-manganese alloy in the iron and steel industry. At this time, steel prices are also very strong, and steel prices accept higher prices for raw materials. Silicon-manganese alloy prices have successfully pulled up and remained at a high level of more than 8000 yuan per ton for many months. Rising prices have stimulated the production of new production capacity that is already on the sidelines, and a number of new production lines were put into production in the second half of the year. It quickly made up for the gap caused by the increase in demand, and the silicon and manganese market entered a state of booming supply and demand, which greatly stimulated the demand for manganese ore imports. Manganese ore imports performed brilliantly in the fourth quarter of 2018, with a total import volume of 8.50603 million tons, accounting for about 31 per cent of the total imports for the whole of 2018.

In a historical review, the strict environmental protection policy in 2017 has reduced the supply of manganese ore in China, but on the other hand, under the influence of the national policy of clearing ground bar steel, the iron and steel industry has driven up the price level of ferroalloy and even manganese ore industry chain. Overseas manganese mines are in a state of high profit, and manganese ore imports increased significantly in 2017. Therefore, in 2017, China's manganese mine supply as a whole showed a slight increase.

China's manganese mine supply continued to rise in 2018, with domestic manganese mine supply increasing by about 15 per cent in 2018 compared with 2017. Although domestic ore production continues to shrink under environmental pressure, imported manganese ore has continued to pour in, spurred by strong demand from domestic smelters, with imports reaching 22.08 million tons from January to October alone, far exceeding the 21.26 million tons for the whole of 2017. As a result, the overall supply of manganese mines in China increased significantly in 2018.

Import and export
manganese ore
silicon-manganese alloy

For queries, please contact Frank LIU at liuxiaolei@smm.cn

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