Spot Prices Remained Stable, SiMn Market Experienced Weak Consolidation [SMM SiMn Daily Review]

As of Wednesday, the cash price of SiMn alloy 65/17 in north China stood at 5,625-5,725 yuan/mt, down 75 yuan WoW, while the price in south China was 5,650-5,750 yuan/mt, down 100 yuan WoW.

Cost side, manganese ore miners showed weaker willingness to offer this week, keeping prices stable. The eighth round of coke price increase failed to materialize, pending the outcome of negotiations between coke producers and steel mills. Currently, raw materials such as manganese ore and coke are in a consolidation phase, with cost support remaining relatively stable but still at a relatively high level.

Supply side, the SiMn futures market was in the doldrums recently, with weak market sentiment. Production fluctuations in north China's Inner Mongolia and Ningxia were relatively small, while operating rates in south China's Yunnan and Guangxi also showed no significant changes. However, factories are already facing losses, leading to reduced production enthusiasm. If futures prices continue to decline, production cuts may follow.

Demand side, some steel mills in north China recently implemented production restrictions due to a military parade, leading to a decline in hot metal output, which somewhat suppressed demand for SiMn alloy. However, as the restrictions are expected to end soon and with peak season expectations, industry insiders predict a rapid rebound in hot metal production. This will support the rigid demand for SiMn alloy, though the extent of this support remains to be observed and verified.

In summary, on one hand, cost support for SiMn alloy remains strong, with factories reluctant to sell below cost. On the other hand, steel mills' current acceptance of SiMn alloy is not particularly evident, coupled with the recent weak performance of SiMn futures, leading to clear price suppression sentiment among mills. Amid this standoff, the SiMn market is consolidating weakly, lacking strong upward momentum. Prices are expected to maintain a fluctuating trend in the near term. Market participants should monitor raw material price movements and downstream steel mills' acceptance of SiMn alloy.