Manganese producers experience hardships
2005-05-24 09:26:34 【Print】
BEIJING (Asian Metal) 24 May 05 – Although manganese market declines stopped in May, market prices remain low, with manganese producers reporting difficult times.
A Guizhou-based producer told Asian Metal that the smelter is struggling to maintain normal production due to the sluggish market. Although the market remains stable, the current prevailing price of RMB12,500/t ex works is low, said the producer.
As the electricity price has increased by RMB0.02-0.029/kwh, effective 1st May, production costs have risen accordingly. “However, sustained low market prices leave us without any profit,” said the source.
“Compared with those who have been washed out, we are lucky,” said the source. “However, we’ll have to reduce our output if the market continues to worsen.”
The smelter is operating at its full production capacity of 7,000tpy, with 300t of material in stock.
Another Hunan-based producer confirmed the situation. Hunan electricity prices have also experienced increases (RMB0.039/kwh) since the beginning of May. “Therefore, our production cost has increased by RMB240-270/t,” said the source.
With its own manganese mine, the smelter is fully operating at its 5,000tpy production capacity. “However, we have a considerable amount of stock on hand without any intention of selling at current low prices,” said the source.
The source holds that producers will continue to be confronted with great pressures in the coming weeks.
