Chinese companies squeezed by electrolytic manganese export tariff

Unforged manganese, manganese scraps and powder, some other kinds of manganese and products made of manganese were put in Promulgating Catalog of Commodities under Administration of Export License, according to the latest announcement by the Ministry of Commerce and General Administration of Customs.

This is another policy adopted by the government to regulate the industry of electrolytic manganese, following the 15 per cent export tariff on unforged manganese that began on Nov. 1, 2006. At the present, price of electrolytic manganese are surging, with a lot of contract-breaching on the market. And at the same time manganese companies are finding ways to export electrolytic manganese without paying the tariff. smm.Com.Cn

The export tariff levied since Jan. 1, 2006 heats the market of electrolytic manganese a lot. At the beginning, the buyers and sellers could not reach agreements on the prices of electrolytic manganese and this made lots of signed contract with the goods unshipped called off. But with the new year approaching, many buyers were starting to accept the prices which are raised from 1260-US$1280 per ton (FOB) to 1500-US$1550 per ton (FOB). 有色金属行业网站 www.smm.cn

Since Dec. 2006, the domestic prices of electrolytic manganese are surging again, because the supply of it are insufficient, especially the supply from Huaheng of Hunan and Xiushang of Chongqing, which are the top two source of manganese. Domestic sellers lift their prices to 1750-1800 US dollars pre ton (FOB) but the buyers abroad did not accepted them. The market depressed again. An analyst from Umetal.net notes that Chinese sellers may raise their prices again with the administration rules specified and the battle on prices will start again. 

According to the statistics of China customs, the production and exports of unforged manganese are affected seriously since Nov. last year. Many enterprises stopped exporting and the volume of manganese exports and the number of export enterprises decreased a lot. Unforged manganese exports in November is 2.4 tons and US$31.68 million, down by 2.7 per cent and 12.9 per cent year on year. Many large producers in Hunan province (the main place in China the manganese exported come from) stops exporting in November. For instance, Eastern Manganese Group Co. Ltd, once the top manganese export enterprise under administration of Changsha Customs, with a production capacity of 3500 tons had done no exports in Nov.

Nowadays, breaching contract in manganese industry is very popular, because plenty of companies would gain nothing, if they carry the original contract out. Such as, the contracts with shipping date after Nov. 1 about 70 per cent of which cannot be performed as prescribed. Many small enterprises with incapability to execute the contract breached them. Only a few huge enterprises performed their contract, protecting their enterprises' reputation.

Besides raising their prices, many companies try to haven the tariff in producing manganese. There are mainly two ways to avoid tariff: One is to export manganese as manganese and aluminium alloy. They first produce pure electrolytic manganese and then blend the manganese and aluminium together, which contains 85 per cent of manganese, 15 per cent of aluminium, in a way of forging them into some shapes. When they declare customs, they use such names as manganese and aluminium, manganese and aluminium additive, manganese and aluminium briquette, and so on. In this way, they get 13 per cent tax reimbursement tariff free. So such exporting is expanding quickly.

Another way is to export manganese in the form of manganese-iron alloy. In the process of producing manganese, they add iron to manganese, which makes the manganese contain only 4-5 per cent of iron. In clearing customs they use the name of manganese-iron alloy and they only pay 10 per cent tariff. Foreign buyers are likely to accept it because of its higher purity.

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Antimony prices hold high

BEIJING (Asian Metal) 4 May 08 – Supported by the high price in European spot market, antimony ingot price keeps firm in China. The tight supply of antimony concentrate is also considered as one of the factors leading to the strong market.
"As Chinese government is enhancing the control of dynamite for safety concern, many small mines were forced to close, and thus the supply of antimony is tightening," a Hunan-based antimony ingot producer said. "Therefore, antimony ingot producers insist on high offers of the material for fear that they cannot get enough raw material for production in the following two months."
The source, who concluded a few deals at RMB38,000-38,100/t (USD5,429-5,443/t) VAT excluded for standard grade-two antimony ingot, is currently offering RMB38,300/t (USD5,471/t) VAT excluded for the material.
The smelter is operating according to antimony concentrate obtained and holds 50-60t of antimony ingot in stock. With an optimistic attitude towards the future market, the source is not hurried to sell at the moment.
Another trader from East China also attributed the firm price of antimony ingot to the short supply of raw material. Additionally, the strong market in Europe also strengthens Chinese producers' confidence about a bullish market.
The source reported that many producers are holding on for higher prices and thus he has difficulty replenishing stocks at a reasonable price. "Some producers quote as high as RMB42,000/t (USD6,000/t) ex works for standard grade-two antimony ingot," said the source who put the mainstream price at RMB41,000-41,300/t (USD5,857-5,900/t) ex works.
Confirming that the raw material supply is getting tighter owing to the control of dynamite, the source predicted that the market would keep at the current high level in the near term.

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Antimony trioxide export prices up

BEIJING (Asian Metal) 5 May 08 - Stimulated by higher production cost and the appreciation of Chinese currency, suppliers raise export offers of antimony trioxide to USD5,350-5,400/t FOB Chinese main ports from USD5,300-5,350/t FOB seen late April. Meanwhile, products with famous brand such as Twinkling Star are being offered at USD5,450-5,500/t FOB, market sources reported to Asian Metal.
A Guangdong-based trader raised export quotation to USD5,400/t FOB for antimony trioxide 99.5%min without famous brand whereas the previous deal was concluded at USD5,250/t FOB two weeks ago. The source reported that the main reasons for the price adjustment are higher purchase cost and also the depreciation of US dollar.
The source reported that demand keeps moderate from overseas market and the company exports 100- 150t of the material every month. However, the source acknowledged that many buyers are scared away by the price jump and plan to watch for a while before purchasing.
A Hong Kong-based trader also reported that the export price of antimony trioxide has been on the rise in line with the increasing market of antimony ingot. Offers received after the May Day holiday were at USD5,350-5,400/t FOB for products with common brand while the famous-branded materials were offered at USD5,450-5,500/t FOB, nearly USD100/t higher than the offers late April.
"We were told that the material is sold at RMB36,500-37,000/t (USD5,214-5,286/t) ex works in Chinese domestic market, and that's why suppliers lifted offers to USD5,400-5,450/t FOB," said the source. As the antimony ingot market is showing signs of rising further on the tight supply of antimony concentrate, the
source thinks that the antimony trioxide price will also keep at the upward trend in the near term.

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Analysis: risks ahead China's nonferrous metal industry

Worldwide economic risks and China's tight economic measures are anticipated to exert negative influence on China's nonferrous metal industry.

Credit crunch triggered by the U.S. real estate industry is passing on its influence to developing countries including China, adding risks on nonferrous metal industry from macro-economic prospective.

Influenced by credit crisis, nonferrous metals in late March ever experienced price nose-dive on international futures market.

Also affected by worldwide crisis, such preliminary products as crude oil, iron ore, copper and alumina are undergoing price rise, pushing up production cost of nonferrous metals.

Under such circumstances, international giants hasten acquisition of small metal companies, further reinforcing their monopolistic position but weakening China's enterprises weight on international market.

Domestically, the tight economic measures to be implemented this year will deteriorate the situation for nonferrous metal industry. China has lifted doorsill for entering industries related to manufacture copper, aluminum, lead, zinc, tungsten, tin and antimony in a bid to wash out backward production capacity.

Besides, other factors such as RMB appreciation and tight credit would affect the development of nonferrous industry.

Snow disaster that hit southern China this winter brought huge economic losses to nonferrous metal enterprises.

According to statistics, 28 electrolytic aluminum makers suffered more than 1.6 million tons of production capacity. A majority of nonferrous metal enterprises in Hunan province had to halt production.

Other heavyweight enterprises such as Jiangxi Copper Corporation, Tongling Nonferrous Metals Group, Daye Nonferrous Metals Company, Jingxi Tungsten Industry Group and Zunyi Titanium were all influenced production. – China Mining

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China antimony market: Weekly comment--May Day holiday

After several weeks of slack in trade, China local antimony market is returning to a balance due to rising demand and supply shortage in antimony ore.

Recently small-scale antimony plants in Hunan Province have stopped operation. As a result, a decrease in production has led to a certain stabilization of antimony prices.

Besides antimony producers began to build inventories before May Day holiday.

However, despite the firmer demand, traders made few deals this week as most of antimony ingot manufacturers are waiting for higher prices.

In the previous week, tax-inclusive price of the No2 antimony ingot on Chinese domestic market was RMB41,500 per metric ton. Antimony trioxide was quoted at RMB37,000-37,500 per metric ton.

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European antimony market keeps increasing

Due to the port and river congestion in Vietnam, antimony metal is piled in China and cannot be ship to overseas. European participants reported to Asian Metal that prices are already around USD6,000/t in warehouse Rotterdam, and market will firm in the coming weeks.

A European trader sold several batches of antimony ingot in the passed week in the range of USD5,900-6,000/t in warehouse Rotterdam, and he claimed that he bought material from Chinese suppliers at around USD5,800/t CIF Rotterdam.

According to him, the consumers are interested in buying now that they are afraid that price may go up further in the near future because the material is not being shipped from Vietnam.

He also sells antimony to U.S., and disclosed that he concluded a few deals last week in the range of USD5,900-6,000/t in warehouse Baltimore. He is offering at above USD6,000/t for 99.65%min standard grade two antimony ingot at the moment.

A European trader confirmed increasing price of antimony at either sides of USD6,000/t in warehouse Rotterdam, and he had received some high offers from China. "One supplier made me a fresh offer today at USD6,300/t CIF Rotterdam for good grade of antimony ingot, but this is crazy price that no one is willing to buy at the moment," said the source.

According to him, he had received some low offers at the beginning of the week. "There was one offer of 60t at USD5,650/t CIF Rotterdam for standard grade two material, I took the offer with no hesitation." He thinks the price will continue to increase in the next few weeks with little material available at the

Although no deals concluded last week, the source was confident that more business would come this week. "Consumers buy when they see increasing prices," the source commented

A third trader disclosed that the offers from China are at around USD5,850/t CIF Rotterdam for 99.65%min standard grade two antimony ingot, and in the range of USD5,850-6,050/t in warehouse Rotterdam. He bought some material for his customer at the above prices for shipment arriving early May.

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American antimony trioxide market keeps firm

As supply is tight, American antimony trioxide keeps firm, and dealers reported deals concluded at USD2.65-2.70/lb d.d.p
A trader source disclosed to Asian Metal that he had sold several batches of antimony trioxide in the last two weeks, and deals were concluded in the range of USD2.65-2.70/lb for Twinkling Star brand 99.5%min antimony trioxide.
He opines that the supply from China is not as much as last year, and the consumers are looking for material that they have used up their inventories in the passed two months. "There was almost no new material arrived U.S. in February and March but the consumers continued their production, so the stockpile of the material is low." He holds high price of antimony trioxide is likely to remain for another few weeks.
A U.S. trader confirmed the higher prices of antimony trioxide in American market at USD2.65-2.70/lb d.d.p., and he holds that there is very little material in American warehouses. "Some people may still have a little material bought at cheap prices, but they want to hold for a little higher prices."
The source reviewed the antimony trioxide market from beginning of the year: "the price was very low at the beginning of this year, and many consumers purchased material at that time. Then we had the big jump of price during the Chinese New Year because less material shipped to America. Just about the price starting to fall at the end of last week, Chinese suppliers increased prices again.

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