[Minor metal] SMM Survey - Manganese Producers

SHANGHAI, Oct. 20 (SMM) -- Domestic prices for refined manganese have fallen to the range of RMB 12,900-13,000/mt after National Day holiday, and a SMM survey of 30 manganese producers reveals the following insights:

    40% of producers believe manganese prices will stabilize for three reasons: first, manganese ore prices will remain high in the near future, resulting in higher production costs; second, more and more manganese producers suspended production, and the environment inspections in Xiushan (Chongqing), Jingxi (Guangxi province), and Jishou (Hunan province) will also exert negative impact on manganese production, which will likely result in slight tightness of market supply; third, the tender at steel mills recently will stimulate market sentiment.

    50% of producers believe manganese prices will fall, but any downward movement will be limited, for two reasons: first, any negative impact from environment inspections at manganese producers in Jingxi and Jishou on manganese market will be limited amid relatively ample supply and sluggish demand; second, large steel mills limited and cut productions, and only purchased refined manganese on as-needed basis, which will have very limited impact on manganese market. In this context, manganese prices will fall further, but any downward room will be limited, as current traded prices were closed to cost prices.

    The remaining 10% of producers were uncertain about manganese prices.

    SMM believes sluggish demand and sufficient supply remain unchanged in refined manganese market, but the tightness of manganese ore supply and environment inspections will likely help support manganese prices to fluctuate in the RMB 12,900-13,100/mt range narrowly.

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