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Market Trend of Import of Ferroalloy as of 15 February 2019
= Movement in ferroalloy market in China after Chinese New Year is on weak note =
Even though Chinese New Year was over in China, the activity in the ferroalloy market is on a weak note, and since a full-scale trading of many commodities has yet to start, many of the prices submitted by the producers and traders are the same as the ones before Chinese New Year. In the European market, there are many traders which intend to move after seeing the result of the trading council between USA and China, and the customers have no factor to make haste to buy, which leads to the price being stabilized.

The Ministry of Lands and Natural Resources of Ghana ordered Ghana Manganese Company (GMC: indirect subsidiary of Tian Yuan Manganese Limited) to suspend operation from February 1, which is because of auditing this company that has a likelihood of dumping export to China. This company's product is manganese carbonate (meant for manganese metal), and there is an information that the manganese metal producer that purchased nearly all of this manganese carbonate is purchasing ores produced at other mine, which has a likelihood of affecting all of the manganese-containing ferroalloys.

The market trend of import of ferroalloy as of 15 February 2019 is as follows.

<> Silicon Metal = The main price of 553 grade in the current Chinese domestic market is CNY11,500 to CNY11,600 per ton and the same of 441 grade is CNY12,300 to CNY12,400 per ton, and both prices have continued to remain unchanged from the middle of January. Both sale and purchase in the Chinese domestic market seem to be at a low level for such reasons as (1) Some of the producers delay a full-scale resumption of operation, (2) Trader's selling motivation is low, (3) Many of the customers finished purchasing for February delivery before Chinese New Year and (4) Aluminium industry waited for the development of the trading council between USA and China. Semicoke is used as raw materials, but comprises a small percentage of the production cost, and almost no impact from the increased price of semicoke has come up to the surface.

The export price also remains unchanged from the middle of January.

In the Japanese domestic market, the customers are careful about purchasing in the spot market so as to increase the in-hand stocks toward the settlement of accounts at the end of March, but the contract price was up by US$40 to US$60 from the end of January for such reasons as (1) Shippers' in-hand stocks are coming down, (2) Export volume from China will decrease during February and (3) Business talks for April delivery in some areas seem to have started.

<> Ferro-silicon = In the Chinese domestic market, by taking advantage of such an occasion as a major steel mill in Hebei floated a tender for 700 tons after Chinese new Year was over, multiple steel mills submitted a price for March purchase. As a result of being affected by the accident which occurred at the coal mine in Shaanxi (Main production area for semicoke) in January, the price of semicoke is up by CNY150 per ton from the one before Chinese New Year, and the focus now is on whether the users such as steel mills and the producers for magnesium metal will accept a price increase and the producers can transfer the rising production cost. The export prices (Si: 75%) show a big difference varying according to the producers, and the upper quotation of US$1,200 per ton also can be seen.

In the Japanese domestic market, the electric arc furnace mills have begun to float a tender for April delivery, and it becomes easy for a cheap price information to flow into the market. For this reason, the difference between upper and lower prices is becoming larger. Some of the Chinese products are up by US$0 to US$20 from the end of January because some of the producers raised the offer price.

As to Russian ferro-silicon, the spot goods are still tight, but an extremely small number of contracts for the shipment during February to March were made meant for the spot market. The price was down by US$0 to US$5 from the end of January.

As to Malaysian ferro-silicon, the producers (OM Sarawak and Pertama Ferroalloys) focus on the production for long-term contracts and Europe, and as to the spot goods for shipments during February to March, there were an extremely small number of contracts at the almost same price as Chinese products.

As to cheap products via Vietnam and directly from mainland China, the distribution seems to be at a low level due to Chinese New Year, etc.

<> Silicon Manganese = The price in the Chinese domestic market stopped declining at the end of January, and the price of Inner Mongolian 6517 product as of February 15 is CNY7,600 to CNY7,800 per ton, and continues to remain unchanged from the one before Chinese New Year. The manganese mine in Ghana was ordered to suspend operation, which has yet to affect silicon manganese, but it has been observed that the price of ores produced by overseas manganese mines meant for China as March shipment will go up, and the retail prices of manganese ores produced in Australia, South Africa and Gabon have begun to go up at the port of Tianjin. For this reason, there is a possibility that the silicon manganese producer will raise the offer price from now onward.

As to the price of Indian silicon manganese, the producers have a strong motivation to raise the price due to observation that the price of manganese ore as March shipment will go up. However, the producers which offer the same cheap price as the one at the end of January are also sporadically seen.

As to the price in Japan, the lower quotation was left unchanged but the upper quotation was pushed up by being affected by the price condition of Indian product, which widened the difference between upper and lower quotations.

As to Malaysian silicon manganese, OM Sarawak and Pertama Ferroalloys Sdn. Bhd. are producing, and the price seems to be at the same level as Indian products.

<> High-carbon Ferro-chrome (including charge chrome) = The state of no trade of spot goods meant for Japan being made is still going on.

The price in China has no movement after it stopped dropping in the middle of January, and the current price remains unchanged from the end of January. The port stock of imported chrome ore in China is stabilized at around 2.85 million tons, but is improved by a large margin from August 2018 (about 3.5 million tons). China's production of stainless crude steel in 2018 was up by 3.6% from the prior year, but since a massive increase in the production during January to Match in 2019 can't be expected, no big movement in the price of high-carbon ferro-chrome can be seen at the present moment, either.

<> Low-carbon Ferro-chrome = The price of spot goods becomes stabilized thanks to decreased inflow of cheap products from China, and the current price remains unchanged from the end of January.

On the one hand, the price in China stops moving after it dropped slightly right before Chinese New Year. The current price was down by around 2% from the end of January.

<> Molybdenum = The price of molybdenum in the Chinese domestic market strengthens a rising trend due to the death accident which occurred in Shaanxi on February 12 in addition to the rising trend in late January. The accident occurred at a subsidiary of Jinduicheng Molybdenum Co., Ltd., and the production line having such annual production capacities as 40,000 tons of sintered ore and 20,000 tons of ferro-molybdenum stops operation. Some of the customers ran toward panic buying as the resumption of operation was not yet in sight, which supported the price hike. The current price of ferro-molybdenum is up by 4% from the end of January, but still has a likelihood of going up furthermore.

The price in Europe turned upward since entering February. The price of molybdenum oxide is up by around 2.7% from the end of January and the one of ferro-molybdenum is up by around 1.7% ditto. On the one hand, the molybdenum price (cash seller) in LME continues to be flat from the end of March.

<> Ferro-vanadium = The price of ferro-vanadium in the Chinese domestic market has continued to be at a low level since the middle of January. Albeit there is a small up-and-down movement, it is within the range of less than 0.5%, and the price seems to be stabilized, but there is still a big difference between the sales price the domestic producers prefer and the purchase price the customers prefer.

The price of ferro-vanadium in Europe dropped again in February, but stops dropping at the present moment. The price is in a state of being down by 2.5% from the end of January.

The price meant for Japan was pushed down as a whole by being affected by the prices in Europe and China, and the current price is down by around 1.4% from the end of January.

<> Manganese Metal = The main price in the Chinese domestic market as of February 15 is CNY13,100 to CNY13,300 per ton and the export FOB price is US$1,980 to US$1,990, and both prices are the same levels as the end of January. The foreign exchange becomes a bit weak against U.S. dollar, but the export price has not been affected. The operation of Nsuta manganese mine in Ghana was suspended, which is thought to give a great impact to major producers in Ningxia, but the price of manganese metal has yet to have a big movement. There is an optimistic observation in the market that the suspended operation of the mine will be temporary and the price will go up, but the shipment will be resumed.

In the Japanese domestic market, the demand remains to be weak, and the number of the contracts for Chinese products as February and March shipments at an upper quotation of more than US$2,100 was small, and the contracts at a lower quotation of less than US$1,950 were almost zero. The price remains almost unchanged from the end of January. However, the shippers in Japan also reinforce the forecast that the production of manganese metal in China will be reduced, and the offer price in the future has a likelihood of going up.
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last modified : Fri 22 Feb, 2019 [10:48]
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