Market Information: Futures of silicomanganese has exceeded 8,000 yuan and the spot seems to rise accordingly.
According to the latest news, a steel plant in Henan announced its bid price of silicomanganese in August. It purchased 4,000 tons at the price of 7,780 yuan/ton (half in cash).
With production suspension and reduction in factories of some regions, the output of silicomanganese was significantly decreased (it is said that many companies have not yet completed the orders of steel plants). The scarcity of silicomanganese together with the better futures performance (the day before yesterday: Max. 8064 and Min. 7740; yesterday: Max. 8000 and Min. 7902; today: Max. 8040 and Min. 7820) greatly supported the spot market (A better situation in the futures market increased companies’ enthusiasm for transactions). As the silicomanganese market went positive and related companies were strongly willing to keep the selling price stable, it was expected that the share prices would rise. Given that the leading steel company had not called for bid of silicomanganese in August, the market players operated cautiously. Today, the silicomanganese market is running steadily, and the actual quotation does not fluctuate significantly. Data showed that the current quotation of silicomanganese 6517# remains around 7,500-7,600 yuan/ton. According to the Alloy Index, as of 9:00 am on July 30, the silicomanganese quotation was 7,668 yuan/ton in Hebei, 7,654 yuan/ton in Shandong, 7,954 yuan/ton in Liaoning, 7,821 yuan/ton in Jiangsu, 7,706 yuan/ton in Sichuan, and 7,780 yuan/ton in Hunan, respectively. The details are as follows.
Futures market: Today, the maximum silicomanganese futures 2109 fluctuated wildly. It rose slightly and then fell in the morning session, plunged in the afternoon, and went upward till the closing. The intra-day high was 8040, and the intra-day low was 7820. 4308 stock holdings were trimmed. The trading volume increased significantly compared with the previous trading day. The K line showed a short black line with a long shadow line. Technically, the effective red column of MACD was slightly shortened. It was predicted yesterday that information would determine the quotation in the short term and become empty in the medium term. Slight pick-up today is in line with the predication. The predication made yesterday remains unchanged today: information will determine the quotation in the short term and become empty in the medium term. It is suggested to hold small positions and timely stop profit and loss.
To sum up, steel plants are expected to launch a new round of silicomanganese bidding next week. The overall inquiry and procurement will be significantly active. With frequent restrictions on power consumption and production, the silicomanganese output may be limited correspondingly. It is possible that the manganese price will go higher, but it needs time to verify.