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Silicon manganese futures hit 'limit up' amid South Africa supply concerns

iconMar 26, 2020 15:26
Source:SMM
The most-active silicon manganese contract for May delivery on the Zhengzhou Commodity Exchange (CZCE) surged to its maximum daily limit of 6% to a nearly seven-month high of 6,950 yuan/mt on March 26, as a nationwide lockdown of major ore supplier South Africa exacerbated supply woes. South Africa has imposed a 21-day nationwide lockdown from midnight on Thursday, in a bid to contain the coronavirus outbreak.

SHANGHAI, Mar 26 (SMM) – The most-active silicon manganese contract for May delivery on the Zhengzhou Commodity Exchange (CZCE) surged to its maximum daily limit of 6% to a nearly seven-month high of 6,950 yuan/mt on March 26, as a nationwide lockdown of major ore supplier South Africa exacerbated supply woes.


South Africa has imposed a 21-day nationwide lockdown effective from midnight on Thursday, in a bid to contain the coronavirus outbreak.


SMM estimates that the move will affect 840,000-960,000 mt of manganese ore supply to China, creating a 14-day supply gap and lowering inventories in the top consumer by about 16%.


On the morning of March 26, Chinese traders of spot manganese ore mostly held cargoes back from the market. Prices of South African semi-carbonate manganese ore at Tianjin port were up 3.5 yuan/mtu from the previous day at 40-42 yuan/mtu, SMM assessed. 


Prices of spot silicon-manganese alloy also trended upwards with quotes 200-400 yuan/mt higher from Wednesday. SMM assessed spot prices of #6517 silicon-manganese in Ningxia at 6,400-6,600 yuan/mt on March 26, 350 yuan/mt higher from March 25.

 

Market commentary
Silicon manganese
Manganese ore
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