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|General Review Of Manganese Metal In 2007 And Its Outlook For New Year|
|= Because Of Extraordinary Fluctuation Of Price, Overseas Consumers Have Left From Usage Of This Metal|
When the movements of price for Chinese electrolytic manganese metal in 2007 are traced, an extraordinary fluctuation of the price has come up to the surface as its characteristic. In the course of the calendar year ( January - December ) of 2007, price of Chinese electrolytic manganese metal had moved in the range of US$5,500 per ton CIF Japan as the highest one and US$1,780 CIF as the lowest one. The highest price was recorded in May of 2007 and the lowest one in the beginning of last year.|
The prices of Chinese electrolytic manganese metal fluctuated in the past two years ( from October - December quarter of 2004 to October - December quarter of 2006 ) were in the range of US$1,700 as the highest and US$1,150 as the lowest. The reasons, why price of Chinese electrolytic manganese metal had risen to an extreme extent in 2007 as mentioned above, are pointed out by the matters of (1) a steep rise of nickel price in the international market caused a higher evaluation of electrolytic manganese metal as a substitutive material for nickel, resulting in an increase of the demand for manganese metal, and (2) a shortage of manganese ore purchased from local mines of China drove to import more manganese ore into China from overseas sources, resulting in a raise of cost for production of manganese metal.
The movements of price ( per ton CIF Japan ) for Chinese electrolytic manganese metal in the calendar year of 2007 were <> January - March quarter : US$1,780 - 3,300, <> April - June quarter : US$3,400 - 5,500, <> July - September quarter : US$3,250 - 3,800 and <> October - December quarter : US$3,000 - 2,800.
The quantity of crude stainless steel produced in China for the calendar year of 2007 is estimated at 7.00 million tons, having increased by 32% compared with that ( 5.30 million tons ) produced in the preceding year of 2006. In addition to an increase of stainless steel production in China stimulated by an expansion of the demand for stainless steel products from domestic market, an extraordinary rise of nickel price ( risen to a level of US$55,000 per ton in May of 2007 ) caused to have shifted the usage at stainless steel mills from nickel to electrolytic manganese metal as a substitutive material. Accordingly, the actual quantity of electrolytic manganese metal consumed by mills had a certain increase.
During a period when nickel price has risen to a considerable extent, the merit to use electrolytic manganese metal is substantial, because the cost of raw material to produce stainless steel by adding 1% of nickel at the price of US$55,000 per ton comes to US$5,500 with nickel content of 1%. On the other hand, even if electrolytic manganese metal at the steeply risen price of US$5,500 per ton is added by 5 - 10% to produce 200 series stainless steel ( containing higher manganese ), the cost of raw material comes to only US$275 - 550. When this usage of electrolytic manganese metal enables to exhibit the same effect as that of nickel on the quality of stainless steel ( such as corrosion resistance, tenacity, and so on ), an advantage of electrolytic manganese metal comes to be substantial.
The quantities of electrolytic manganese metal produced and sold by China in the calendar year of 2006 were <> production : 640,000 tons, <> domestic sales : 300,000 tons and <> exports : 340,000 tons, and domestic sales came to 47%, having reached nearly half of the whole sales. The figures for 2007 are not known yet but domestic sales of this metal in 2007 are supposed to be more than 50% of the whole. This trend is anticipated to continue further. The current capacity to produce stainless steel in China is thought to have already exceeded a scale of 10 million tons per annum and a basic tone to increase stainless steel production in China is anticipated to be still maintained in 2008 ( to increase by 10% ).
Also, a ratio to produce 200 series stainless steel in China, requiring a large quantity of electrolytic manganese metal to be used for the production, has reached 50% of the whole production and an importance of electrolytic manganese metal as an additive agent in China is very large in comparison with that in the western world. A differential of quantities between domestic sales and exports will probably enlarge further. There is a view in the market that the composition on supply and demand of electrolytic manganese metal in China, having developed in reliance on exports, will incline largely to domestic sales.
However, Chinese electrolytic manganese metal accumulated their exports on a scale of more than 300,000 tons per annum, having driven out almost of rival producers from the western markets, but the exports of electrolytic manganese metal are still an important business for Chinese producers, because the capacity to produce electrolytic manganese metal in China is supposed to have already exceeded a scale of 1,200,000 tons per annum, having become an excess.
The demand for electrolytic manganese metal in overseas countries is going to change to a considerable extent. In view of a large fluctuation of price for Chinese electrolytic manganese metal and an instability of deliveries from China, major consumers in Japan ( blast furnace mills ) are anticipated to leave further from their use of electrolytic manganese metal in 2008. Japan imported 75,000 tons per annum of Chinese electrolytic manganese metal and two companies of Nippon Steel and JFE Steel consumed 65% of the imports but have now planned to shift a certain part of their usage from this metal to super low carbon ferro-manganese.
Nippon Denko, an affiliated company of Nippon Steel, is scheduled to increase their production of super low carbon ferro-manganese at the Tokushima plant by means of expanding the capacity ( to set up the structure in 2008 to produce 30,000 tons / year ). Also, Mizushima Ferroalloy, a subsidiary of JFE Steel, is the producer of super low carbon ferro-manganese in Japan and JFE Steel has already shifted to give a priority to purchase super low carbon ferro-manganese from Mizushima Ferroalloy. Since these two major steel companies have changed their policy for purchases of manganese contained raw materials, the imports of electrolytic manganese metal from China into Japan have changed from the second half of 2007. The matter to maintain the markets for exports of electrolytic manganese metal is very important for China in 2008.
The Central Government of China announced on the 26th December of 2007 to revise the duty on exports of manganese metal from China and has raised the export duty to 25%, effective from the 1st January of 2008. The duty on exports of Chinese manganese metal was 15% by the end December of 2007 and, accordingly, a ratio of the export duty in cost for export has raised to a large extent. On the basis of the policy which the Central Government of China has intended to put the brake on exports of electrolytic manganese metal, Chinese producers have to endeavor hereafter their exports of electrolytic manganese metal and, consequently, have been deeply placed in the difficulties.
|last modified : Fri 11 Jan, 2008 [10:24]|