China’s HBIS Raises October Manganese Alloy Tender Prices Amid Rising Steel Demand and Production Costs

HBIS

Hebei Iron and Steel (HBIS), one of China’s largest state-owned steel producers, has increased its October tender prices for manganese alloys, responding to higher steel output and rising production costs. The price hike reflects intensified demand for steel and growing costs of alloy feedstock.

HBIS’s initial October tender price for 12,000 tonnes of silico-manganese (65/17 grade) is set at 6,200 yuan per tonne (approximately $871/t) for delivery and acceptance bill payment, marking a 220 yuan/t increase from September. HBIS has also raised its purchase volume by 1,500 tonnes compared to the previous month. Industry negotiations with long-term alloy suppliers are ongoing.

Several alloy producers anticipate further price increases, projecting the silico-manganese bulk alloy price could reach 6,300 yuan/t as production costs have surged to 6,100-6,200 yuan/t due to more expensive ore feedstock.

Additionally, HBIS raised its October tender price for high-carbon ferro-manganese (65% grade) by 200 yuan/t to 5,900 yuan/t, with a purchase volume of 7,297 tonnes, up by 147 tonnes from September.

The surge in steel prices and demand—fueled by seaborne buyers—has led many mills to boost production since September, further supporting an uptrend in alloy feedstock prices. Data from the China Iron and Steel Association (CISA) show that crude steel output from member mills rose by 1.3% in late September, averaging 2.01 million tonnes per day between 21-30 September. CISA’s data encompasses over 100 of China’s largest steel mills.

Steel prices soared at the end of September, boosted by the Chinese government’s economic stimulus measures, including interest rate cuts and a lowered reserve requirement ratio for banks. China’s steel exports also climbed significantly, rising 26% year-on-year to 10.15 million tonnes in September, driven by strong overseas demand and favorable export prices.

Recent assessments show the 65/17 silico-manganese alloy grade priced higher by 200 yuan/t, reaching 5,800-5,900 yuan/t ex-works as of mid-October. Despite spot deals at these elevated prices, some alloy producers offered between 6,000-6,200 yuan/t ex-works. Meanwhile, the high-carbon ferro-manganese 65% grade held steady at 6,500-6,700 yuan/t ex-works, though many buyers were reluctant to engage in spot purchases at these levels.