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| HOME >> Topics List >> September, 2008 >> 25 (Thu) |
| Chinese Si-Mn Is Suddenly Colored With Depression And Its Production Is Being Successively Reduced |
| = Production Is Not Payable For Costs, Producers In Guizhou, Hunan, Inner Mongolia Suspend Its Operation |
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The production of silico-manganese in China has suddenly and largely decreased. This decreased production of silico-manganese is due to an unprofitableness to produce silico-manganese in China caused by an extraordinarily risen price of manganese ore as raw material and an overproduction of silico-manganese as seen in the past years. Namely, (1) 40 electric furnaces have existed in Xingyi area of Guizhou Province but only less than 5 furnaces are being currently operated., (2) More than several tens of electric furnaces have existed in Dongan county of Hunan Province and many producers have been engaged in production of silico-manganese but a number of enterprises, which have been operating these electric furnaces at present, are thought to be only 10 producers., and (3) Nearly 40% of producers in Guangxi Zhuang Aut. Region have suspended their operation and many of electric furnaces installed at plants in Inner Mongolia Aut. Region and Hunan Province have been stopped to operate. The current price of silico-manganese with Mn 65% min. and Si 17% min. prevailing in domestic market of China is in the range of CNY12,000 - 12,400 (US$1,764 - 1,823) per metric ton and that in Huanan area is CNY11,800 - 12,000 (US$1,735 - 1,765) per metric ton. On the basis of these CNY prices, the net cost ex. plant for production of silico-manganese is estimated to have a loss of US$300 - 400 per metric ton. Reflecting this increased cost, the floor price for export of silico-manganese from China set up by customs-offices at shipping ports has risen by US$100 per ton to US$2,400 per metric ton FOB China in comparison with that fixed for August shipment. However, the market price of Chinese silico-manganese offered for Japan is US$2,300 - 2,350 per metric ton CIF and the sales at these prices are unable to progress, because cargoes of Chinese silico-manganese have been overstocked in Japan. When the cost to produce silico-manganese in China is estimated, provided that manganese ore as raw material is 100% used by imported cargoes, only the direct cost (consisting of ore, reducer and electric power) is thought to come to US$2,076 per ton and that, including various charges, will total to US$2,226 per ton FOR plant. For a reference, the data for this estimation are that price of manganese ore is US$14.20 per Mn 1% CIF China on the average of US$12.20 for April - June quarter and US$16.20 for July - September qurter, price of coke is US$440 per ton and fee of electric power is CNY0.50 per 1 KWH. Owing to this decreased production of silico-manganese, large stocks of manganese ore imported and discharged at main ports of China have been accumulated to a remarkable extent at present. It is supposed that 400,000 - 500,000 tons at Lianyungang Port, 300,000 tons at Fangcheng Port and 300,000 tons at Zhanjiang Port have been stocked and, consequently, 1,500,000 - 2,000,000 tons in total of manganese ore have existed in China. The increased stocks of manganese ore in China have been affected by that this country imported 900,000 tons of manganese ore in July of this year. China has been importing manganese ore in 2008 on a scale of more than 8 million tons per annum. As a matter of fact, China imported 4,765,000 tons of manganese ore in the first 7 months (January - July) of 2008 compared with that (3,273,000 tons) imported in the same period of 2007. Spot price of manganese ore sold on the basis of delivery from stocks at wharf in China has fallen. The latest prices sold in China are CNY124 - 128 (US$17.97 - 1.55) per Mn 1% for Australian manganese ore with Mn 45% and CNY83 (US$12.20) per Mn 1% for low grade manganese ore with Mn 33% (Fe 1.09% and P 0.04%) produced in Morocco. These spot prices are still higher than those settled on quarterly base with regular consumers in China under yearly contracts, because a major producer of manganese ore in Australia proposed Chinese producers of ferro-alloys the price of US$16.30 per Mn 1% CIF for manganese ore with Mn 44% base to be shipped in October - December quarter of 2008 compared to that (US$16.20) for shipments in July - September quarter. There is a view in the market that the price of Australian manganese ore settled with Chinese side for shipments in October - December quarter under regular contracts has been actually rolled over. This settlement of price for manganese ore is thought to have been influenced by overstocks of manganese ore and reduced production of silico-manganese in China. |
| last modified : Tue 30 Sep, 2008 [11:11] |
