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Japan Ferroalloy Import Market Report - January 15, 2013
= The New Year started with Mn ore price rise that could stimulate the Mn market to wake up =
The market situation in Japan of ferroalloy imports as of January 15 is as follows.

<> Summary: BHP Billiton raised its prices for manganese ores to be shipped during February 2013 to China by US$0.20/dmtu. The raise was the first time since July 2012, attracting concerns in the market about whether the price rise would stimulate the market and trigger further rises not only in the ore prices but also in the prices of manganese group ferroalloys. Molybdenum oxide price is also picking up from the bottom towards US$12/lb due to major producers' curtailment. These price rises will hopefully help mining companies to improve profitability, especially Consolidated Minerals, a manganese miner in Australia that recorded an operating loss of US$4.5 million in the Q3 (July - September) of 2012, and Thompson Creek Metals, a molybdenum miner in the U.S.A. that suffered from an operating loss of US$37.4 million in the Q3.

<> Silicon Metal: The impact of the announcement by the Chinese Government to eliminate the export duty on silicon metal (from the provisional rate of 15% to zero) has ranged over various aspects. After the announcement on the export duty, not a few producers maintained the same level of offer at US$2,200/ton CIF trying to eventually raise the price by keeping the equivalent value to the abolished duty in their pockets, but no consumers admitted such a try, i.e. nobody bought at the offered level. When the New Year came, the producers, after the failure to raise the price much, lowered their offer prices to US$2,080 - 2,100/ton CIF that was based only on the market price increase in China's domestic market. Current concerns in the market are focused on how much more of tonnage the producers will be able to sell within January.

<> Ferrosilicon: There is a big difference between the prices of Chinese ferrosilicon for domestic users and for exports. The price for domestic market has been gradually rising, while the one for export market is under pressure from Japanese buyers' resistance against any price rise. Those traders/distributors of Chinese ferrosilicon are in a difficulty to make profits due to the recent depreciation of yen currency, as they already contracted their sale to steel mills in yen. In addition, their headache is the delays in inland transportation due to the troubles caused by the unusually cold winter. As a result, the scheduled shipments for January are being delayed, over to after the Chinese New Year holidays, i.e. to end-February, or to early March in the worst case. The price for quarterly shipments, namely for the Q1 (January - March), is said to have been finalized at some US$20 - 30/ton lower than the price in spot contracts. The contracted prices for Russian materials have been a bit lowered despite higher offered prices inspired by the higher-priced Chinese offers.

<> Silicomanganese: Offer prices for Indian origin materials have been basically unchanged. Although the Indian producers do not raise prices, Japanese consumers must accept higher prices in yen currency due to its depreciation. Neither the sellers nor the buyers can enjoy the current situation even if deals are done.

In China, the price of silicomanganese for domestic users has been rising since end-December based on the price rise of ores triggered by the recent announcement by BHP Billiton of its raise in export prices of the ore to be shipped to China in February. The offered prices of silicomanganese for exports to Japan also rose reflecting the higher transportation costs before the Chinese New Year. Only a few deals have been reported done.
last modified : Mon 21 Jan, 2013 [13:45]
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