Flood situation disturbance boosts sentiment, manganese sulphate prices edge up [SMM Battery-Grade Manganese Sulphate Weekly Review]

This week, China’s manganese sulphate market generally consolidated on a strong note, with spot prices edging up. The recovery this round was driven mainly by short-term supply disruptions from floods in Guangxi and a repair in market sentiment.

Affected by the flooding, several manganese salt enterprises in Guangxi’s main production area underwent temporary production halts for maintenance, tightening short-term spot circulation. Downstream delivery pressures climbed and pressing for orders intensified. Producers’ tendency to hold back from selling rose, providing temporary support to prices. Demand side, while downstream precursor operations were steadily recovering, overall end-use demand was relatively mediocre. Spot replenishment purchases were weak and no significant demand growth emerged. Market transactions were supported solely by long-term contract orders; sporadic restocking led to a slight improvement in trading. Meanwhile, ample overall inventories upstream and downstream effectively offset expectations of tightness caused by the temporary supply contraction. End-users maintained a cautious purchasing strategy of buying on demand and running low inventories, with no concentrated stockpiling, resulting in a lack of upward momentum and clearly limited price gains. The industry’s overall loose supply pattern remained essentially unchanged, and the market consolidated mildly on a strong note.

Looking ahead, favorable support continues to build up. The tight spot supply of sulphuric acid raw materials is unlikely to ease in the short term, providing solid cost support. Coupled with the gradual commissioning and release of medium-nickel high-voltage precursor capacity in Q3—a process with higher specific consumption of manganese feedstock—this is expected to continuously drive rigid demand growth. In the medium and long term, the manganese sulphate market still has potential room to climb steadily.