【SMM Analysis：Excess Supply of SiMn Alloy, Spot Prices Continue to Decline】

【SMM Analysis：Excess Supply of SiMn Alloy, Spot Prices Continue to Decline】In 2024 Q3, supply side, significant production cuts occurred in the main SiMn alloy production areas of both north and south China. The primary reason was that although manganese ore prices slightly decreased, they remained high. The production costs for SiMn alloy plants decreased compared to Q2, yet they still faced losses on production. In the northern main production areas, due to cost advantages in electricity, production schedules were slightly reduced, and the reduction in SiMn alloy production was lower-than-expected. In the southern main production areas, higher electricity costs led to higher production costs than in the north, resulting in severe production losses and widespread furnace shutdowns for maintenance. Overall, in 2024 Q3, although SiMn alloy plants reduced production, the reduction was lower-than-expected, and production remained high. In 2024 Q3, demand side, due to the impact of high summer temperatures and rainy weather, many steel plants reduced or halted production, leading to weak demand for SiMn alloy. Q3 is traditionally a low-demand season for SiMn alloy, providing insufficient support for demand. Overall, in 2024 Q3, downstream demand for SiMn alloy was weak, with low purchasing enthusiasm, resulting in an excess supply situation. Additionally, the slight decrease in manganese ore prices weakened cost support for SiMn alloy, and spot prices continued to decline.