SMM Weekly Forecast on China's EMM Market

SHANGHAI,Sep 30,(SMM)--According to SMM sources, although the operating rate of EMM enterprises in Guizhou province decreased significantly due to the energy efficiency policy, the overall operating rate of EMM market still remains around 50% boosted by that of Xiangxi area in Hunan province, and the output didn't drop significantly. However, the operating rate of EMM will decline again due to the short supply of ore powder if the mines are still under rectification after the National Day holiday. On the other hand, if the rectification ends after the holiday, the operating rate of EMM will rise slightly under condition of normal supply of ore powder. (The rise won't be significant due to the energy efficiency policy). 

Although the downstream stainless steel market is in a relatively traditional peak demand period of October, EMM market may not perform better as China is intensifying real estate regulation. Meanwhile, as the power restriction has resulted in the output reduction of stainless steel, its demand for EMM will also be limited. The output restriction and reduction of ferroalloy will also lead to a stable demand for EMM. The export market will remain moderate.

So SMM believes that, the low operating rate of EMM market due to the short supply of ore powder will rise as the rectification of manganese mines ends after the National Day holiday, which will weigh down EMM prices. However, EMM prices will barely significantly fall due to the high cost and short supply, as well as the background of steady demand from downstream producers. Mainstream EMM prices will fluctuate between RMB 16,600-17,000/mt. If the deadline of the rectification hasn't been decided, EMM prices will keep rising due to the output decline again. However, the low operating rate of its downstream stainless steel enterprises will rein in the significant surge of EMM prices, and mainstream EMM prices will fluctuate between RMB 17,000-17,500/mt.

Copyright © SMM. All Rights Reserved

None of this material may be used for any commercial or public use in any forms or means, without the prior written consent of SMM. For reproduction issue, please contact us by email: service.en@smm.cn