In the futures market, the most-traded SiMn alloy contract in July fluctuated around 7,380.35 yuan/mt. The highest settlement price at 10:15 was 7,988 yuan/mt, down 11.87% MoM from last month's 9,064 yuan/mt, and the lowest was 6,814 yuan/mt. The market fluctuated significantly in July, and under the imbalance of supply and demand, SiMn prices ran weakly.
In the spot market, there are still some cost differences between the north and south. Although electricity prices in Inner Mongolia rose, Inner Mongolia remained a region with electricity cost advantages, while electricity prices in other regions fluctuated slightly. Overall, the north still has cost advantages. Supply side, SiMn alloy plants in south China reduced production due to losses, while those in the north mainly fulfilled previous orders, with a slight increase in output. Demand side, due to high temperatures and rainy weather, as well as a significant decline in profits of steel mills, the reduction or suspension of production at steel mills further expanded, leading to reduced demand for SiMn alloy. Overall, as SiMn alloy supply still exceeded demand, prices ran weakly.
Additionally, according to SMM, in August, the high temperatures led to an increase in the number of steel mills shutting down for maintenance, reducing demand for SiMn. Currently, it is the off-season for demand. Affected by weak downstream demand for SiMn alloy, SiMn alloy prices are expected to continue to run weakly.
