Silicon‑Manganese Output Rises MoM in September: North Surges, South Mixed

In September, the overall domestic supply of silicon‑manganese alloy rose compared with August, with national output moving higher month‑on‑month. Nevertheless, operating rates across producing regions did not expand in lockstep. A pattern took shape featuring output growth in northern producing areas, mixed performance in southern regions, and general moderate output contraction in minor producing zones, further highlighting regional divergence in production.

Northern core producing areas acted as the key driver behind September’s output growth. As the heartland of domestic silicon‑manganese production, Inner Mongolia and Ningxia saw notable rises in operating rates, with prominent resumption and capacity expansion among local enterprises. They constituted the primary source pushing up the national total output. Favorable overall operating conditions and sufficient raw‑material supplies in northern regions, coupled with improved production margins, incentivized plants to raise operating rates voluntarily. Other secondary northern producing areas showed mixed performance: some posted modest increases in operating rates while a handful witnessed slight cuts. However, such changes were limited in volume and did not alter the general uptrend of northern output.

Southern producing regions exhibited internal divergence rather than across‑the‑board output growth. Supported by cost‑effective power prices under wet‑season hydropower incentives, producers in Yunnan lifted operating rates substantially in September, achieving higher month‑on‑month output and further capacity release. By contrast, manufacturers in Guizhou and other areas proactively lowered operating rates amid climbing coke and power costs during the month, resulting in contracting month‑on‑month output. Chongqing maintained steady production rhythms with operating rates largely unchanged from prior levels.

Most remaining small‑to‑medium‑sized producing zones saw moderate output declines. Regions with medium‑and‑small‑scale production capacity including Sichuan, Henan, Hunan and Xinjiang generally recorded modest cuts in operating rates in September. Home mostly to small‑and‑medium‑sized manufacturers, these zones are highly sensitive to market margins, adjusting production flexibly in response to futures and spot prices. Though multiple areas reduced output, their individual volumes were too small to exert material impact on national aggregate supply and could not offset the output increments from major northern producing bases.

To sum up, September’s supply growth of silicon‑manganese was structural instead of a nationwide broad‑‑based increase, with output increments highly concentrated in northern core producing regions. Favourable production conditions keep northern producers strongly motivated to sustain high operating rates. Constrained by multiple practical factors, southwestern regions feature greater production flexibility and stark internal divergence. Small‑and‑medium‑sized producing zones adjust production mainly in response to market shifts.

The concentrated supply release has built substantial supply‑side pressure on the market. Despite output cuts in some regions, their scale cannot offset northern output gains, keeping overall supply in an expansionary phase. Going forward, it is critical to monitor whether expanding supply can be absorbed by downstream demand. Insufficient purchasing from downstream steel mills would place downward pressure on silicon‑manganese prices. In the meantime, attention should be paid to whether margin fluctuations will in turn influence production willingness among major producing regions.