Manganese flake falls further

1 Aug 08 - Manganese market remains in weak demand and the price falls to RMB20,200-20,500/t (USD2,953-2,997/t) ex works but more suppliers are reluctant to sell for the moment.
A Guangxi-based smelter with a capacity of around 2,000tpm told Asian Metal that few buyers are in the market for the moment. "Demand is still very weak as the stainless steel market remains dull for the moment," said the source who claimed that some suppliers lowered their offers to RMB20,300/t (USD2,968/t) ex works but they offer a much higher price of RMB20,600/t (USD3,012/t) ex works.
The source still keeps a stock of around 200t but is not very willing to sell for the moment. "We still have some long-term contracts to fulfill and the current price is also low for us," said the source who claimed that they might accept a current bid of RMB20,600/t delivered to Guangzhou.
A Hunan-based trader lowered their offers from USD4,100/t FOB to USD4,000/t FOB. "Though the price in foreign markets seems to be high but few buyers are purchasing in the market," said the source who is very pessimistic about the market in August. "The domestic market is also sliding with the price falling to almost RMB20,000/t (USD2,924/t) ex works."
According to the newly published policy from the government, no adjustment is adopted to the manganese briquette export. "Many manganese exporters are very disappointed," said the source. "And maybe more consumers would consider using briquette due to its low prices.
However, the MC and LC FeMn price remains higher than manganese flakes and this also gives birth to some notions that manganese price might be pushed higher in the coming weeks.

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Manganese flake market summary Jul 28-Aug 1

4 Aug 08 - Manganese market falls down in the week after a temporarily rebound to over RMB21,000/t (USD3,070/t) ex works. Sources reported to Asian Metal that more buyers went away from the market when the price went up and demand from downstream stainless steel mills remains dull for the moment. Sources are not so optimistic now.
The price fell down from the highest level of around RMB21,200/t (USD3,099/t) ex works to almost RMB20,000/t (USD2,924/t) ex works. Few buyers are purchasing at the moment while many foreign participants are still on vacation and there is also large stocks there. Some participants lowered their prices to around RMB20,300/t (USD2,968/t) ex works late in the week but others are reluctant to sell at such low prices.
The power supply in some areas remains tight and the manganese production is below capacity. And many small-sized smelters have already been out of production for long. But compared to the low demand, the supply remains sufficient. However, some smelters reported that the supply of raw materials is also tightening which hampers the normal production. As a result, some smelters with low stockpiles at hand insist on higher prices of around RMB20,500/t (USD2,997/t) ex works though few deals are concluded. Suppliers believe that this is the worst time for the market and they hope more buyers would be back to the market in late August or early September and the price should be around RMB21,000/t (USD3,070/t) ex works.
Export market also falls down with few buyers eager to purchase now. The tax adjustment comes out on July 31st but has little influence on the manganese exportation. Some participants are afraid the price might go lower in the coming weeks. Some briquette suppliers lowered their offers to around USD3,250/t FOB again from USD3,400-3,500/t FOB but some others are still very cautious as they usually attach the items to the long-term contracts and if the government changes the export duty, the price should be negotiated one more time. Manganese flakes price also decreased to USD3,950-4,000/t FOB accordingly.
However, the price in warehouse Rotterdam is a bit higher at around USD4,100-4,200/t for the moment but few consumers are purchasing. Sources are not quite confident about the market in August and the price might go down again in the coming weeks.

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Magnesium market expected to keep low

Weak demand continues to hinder the magnesium ingot market from recovering in China. Coupled with the high stockpiles, participants take negative expectations on the future market.
A Shanxi-based smelter, with the capacity of 10,000tpy, cut its output by 1/3 due to the sluggish market. "RMB26,000/t ex works is our bottom line," said the source. "However, few consumers would like to accept such a price."
The source attributes the continuously decreasing prices to the weak demand and oversupply. As long as the market keeps softening, consumers will not resume purchasing. "That's the rule," added the source.
The source holds some stocks on hand and is busy conducting sales for fear that the market may dip further. He learnt that lower prices of RMB25,300-25,500/t ex works have shown up in Fugu, Shaanxi.
A Henan-based trader reported that the trading volume shrank to 100-200tpm in June and July against 400-500tpm in the previous months. "What troubles us most is lack of demand," said the source. "Most consumers are waiting for lower prices."
The source thinks that besides the weak demand in domestic market, the fact that foreign buyers are also sitting on the sidelines is also having negative impact on the magnesium market. As many overseas buyers had considered fully the impact of Beijing Olympics, so they made bulk purchase in advance for the production during and immediately after the Olympic Game.
The source confirmed that although major smelters still insist on the price of around RMB26,000/t ex works, more others have started to sell materials at RMB25,700-25,800/t ex works or even lower prices this week.Both sources are pessimistic about the future market, believing that the price will continue to dip in the following two or three months.

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Some magnesium producers reduce output on sluggish market

More magnesium smelters especially in South Shanxi reduce output or even halt production due to the continuously sluggish situation, market sources reported to Asian Metal today.
"We reduced production by 2/3 in the middle of July," said a producer in Jiang county, Shanxi Province whose capacity of magnesium ingot expanded from 10,000tpy early this year from previous 3,000tpy.
"As demand has kept weakening, and prices have also been in decline, we have to reduce our output," said the source. With some materials in stock, the smelter refuses to sell any materials at prices below RMB26,000/t (USD3,807/t) ex works which is said to be its production cost. However, the source has no confidence in seeing a better market in August in view of the weak demand.
Meanwhile, the source revealed that some smelters nearby have already shut down due to either environmental problems or the bearish market.
Another smelter in Shanxi's Wenxi county, with a capacity of 600tpm, halted production in early July. "In the light of current prices of raw materials, the production cost of magnesium ingot should be at least RMB26,000/t (USD3,807/t) ex works in South Shanxi," said the source. "However, few smelters can obtain such a price for now." Therefore, the source has no plan to restart in the short term.
The source learnt that the magnesium ingot market continues to worsen and more smelters have begun to sell at prices of RMB25,300-25,500/t (USD3,704-3,734/t) ex works. "We heard that some small smelters undersold materials at a price as low as RMB24,500/t (USD3,587/t) ex works when cash was urgently needed, but we could not confirm such a low price," said the source.
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The source also holds a pessimistic attitude towards the future market, believing that the price will probably drop to RMB24,000/t (USD3,514/t) ex works or lower levels soon.

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Magnesium ingot export prices down further

1 Aug 08 – The magnesium export price goes down further due to lack of consumer demand. Suppliers worry that the price may continue to slip in August when most European buyers are absent for summer holidays.
A Shanxi-based smelter has not concluded any export deals since early July and reported that only two or three tentative inquiries have been received. "We don't bother to make offers as we're aware that foreign buyers have no intention of buying," said a sales executive from the smelter.
The source offered at USD4,500/t FOB Tianjin last week without any deals concluded and reported that most suppliers have decreased offers to USD4,300-4,400/t FOB this week. However, the source revealed that little activity is seen in the export market.
Meanwhile, the source reported that the domestic market also remains dull with prices sliding down slowly and steadily. It is hard for them to sell magnesium ingot at RMB25,800/t ex works for now. The smelter is running at less than half of its capacity of 10,000tpy at the moment.
A Beijing-based trader confirmed the sluggish market for export and was surprised to receive a counter bid as low as USD3,800/t FOB China made by a Korean buyer. "Such a bid is far lower than USD4,300/t FOB China, which is the lowest price we can accept now," said the source.
The source reported that demand from Europe, Japan, Koran and India is very weak. Many dealers have ceased buying as their customers do not place orders with them.
A major Ningxia-based producer echoed that few foreign buyers are in the market. The source has reduced offers from USD4,400/t FOB early this week to current USD4,300/t FOB, but buyers still show no interest.

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Manganese market inactive in China

31 Jul 08 - Manganese market goes inactive though the suppliers lowered their offers slightly due to low demand in summer. Sources reported that the price has been around RMB20,200-20,500/t (USD2,971-3,001/t) ex works but still few deals are concluded.
A Hunan-based smelter who just delivered some materials concluded last week at around RMB20.800/t (USD3,045/t) ex works told Asian Metal that though the supply in domestic market remains tight, the price goes down again to below RMB20,500/t (USD3,001/t) ex works. "Few buyers are purchasing at the moment. And the market might be very dull in August," said the source who still owns about one cargos of stocks at hand.
The source claimed that manganese production in the local area is abnormal due to the power shortage and the supply of raw materials is also tightening. The source claimed one major smelter just closed in the area and they are also running at half of the capacity of 12,000tpy. The source believes few suppliers have large stocks at hand. "Actually, we are not so eager to empty the stocks at the moment and there is no meaning for us suppliers to lower ther price before any one makes an offer."
Another Hunan-based trader still quotes USD4,050/t FOB but received no reply recently. The source claimed that manganese price is rising in European markets but as fewer buyers are purchasing from China for the momen, they could not sell a good pricet. "We learnt some deals were concluded at around USD3,950-4,000/t CIF Rotterdam, which we think too low for us," said the source who feels hesitant to conclude a deal at current price level of around USD3,950-4,000/t FOB. "The price in foreign markets is rising and we hope the buyers would find our offer workable in the coming weeks."
however, the source is not quite confident about the market trend. "We don't know how long could the higher prices last in warehouse Rotterdam as demand would remain weak in the coming weeks," said the source who claimed that the domestic price decreases to RMB20,200/t (USD2,971/t) ex works for the moment.

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European manganese market keeps weak

1 Aug 08 – According to market participants, the European manganese market keeps quiet with few inquiries from consumers, as most people are on holidays during the summer period. Manganese flake prices are reported in the range of USD4,100-4,200/t in warehouse Rotterdam, and Chinese offers in the range of USD4,050-4,150/t CIF Rotterdam.
A European trader holds manganese flake prices to be in the range of USD4,100-4,200/t in warehouse Rotterdam. He is also receiving Chinese offers in the range of USD4,050-4,150/t CIF Rotterdam.
The source claimed that the manganese market is very quiet as most consumers have gone for summer holidays. "We have not received any inquires this week nor concluded any deals. Most consumers keep their production and consumption at minimal during this period of time, and most have enough stocks to last through the summer."
He believes that the demand for manganese flakes would keep weak through the summer but expect demand to grow in the 4th quarter, arguing, "As the productions of European steel mills are still very good, we expect more buying activites when consumers return from the summer holidays to book material for 4th quarter production."
Another trader holds manganese flake prices to be in the range of USD4,100-4,200/t in warehouse Rotterdam. He is also receiving Chinese offers in the range of USD4,050-4,150/t CIF Rotterdam.
The source opined that the slight rise of manganese flake prices in the last week would not continue, reasoning, "Believing manganese flake prices have reached the bottom, some traders came into the market last week to purchase material for positioning in the next quarter. However, the fact remains that we haven't seen buying activities from the end-users."

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