The SiMn Market Fluctuates Upward, Post-Holiday Market Watch-and-See Sentiment Strong [SMM Silicon Manganese Futures Review]

On February 26th: The SM2605 contract opened at 5,748 yuan/mt and finally closed at 5,918 yuan/mt, up by 2.85%, with a daily highest price of 5,968 yuan/mt and a lowest price of 5,740 yuan/mt. The trading volume was 722,600 lots and the open interest was 451,708 lots. The futures showed an upward trend. Cost side, frequent news from manganese mines has stimulated the manganese ore market to continue to hold up well. There is a significant regional divergence in electricity prices, becoming a key factor affecting the competitiveness of alloy plants in different production regions. Electricity prices in northern production regions are expected to remain low, highlighting their cost advantages, while there is currently no downside room for electricity prices in the main southern production regions. The coking coal and coke markets are generally in the doldrums, exerting a relatively mild impact on SiMn costs. Supply side, there is a divergence in SiMn supply between the northern and southern markets. On one hand, there are still expectations for some alloy plants in Inner Mongolia to start production and resume production, which will subsequently lead to an increase in SiMn capacity release and gradually highlight the pressure on the supply side, and this is expected to constrain price increases. On the other hand, most SiMn manufacturers in south China find it difficult to resume production due to increased costs resulting from raised electricity fee policies. Demand side, the mainstream steel bidding prices for February have not been announced yet, and the market is awaiting the impact of steel bidding pricing on the market.