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Top Interview:The alloy enterprise shall produce according to demand;The price of manganese ore will return rationally.

  • Tuesday, April 3, 2018
  • Source:中國鐵合金網(wǎng)

  • Keywords:manganese ore price June
[Fellow]Top Interview:The alloy enterprise shall produce according to demand;The price of manganese ore will return rationally.

Top InterviewThe alloy enterprise shall produce according to demand;The price of manganese ore will return rationally.

Ferro-alloys.com: On April 3, Xue Yongmin, the chairman of Shanxi Dongfang Resource Development Co.,Ltd., was interviewed by Liu Zhengzhi, the chairman of ferro-alloys.com

Ferro-alloys.com: How does chairman Xue judge the futures manganese ore?

Chairman Xue: The purchase of futures manganese ore, shipment in late May orJune, it will arrive China until July. That is pretty long time which brings high risk. So we do not plan to purchase future manganese ore right now. If we need manganese ore, we calculate the spot price according to the price of the alloy. If the alloy enterprise can make profit then can production if not we can stop production. In the future, we will reduce the direct procurement of future manganese ore, let traders and miners buy, and reduce the number of external and internal competition.

Ferro-alloys.com: How to judge the pattern and trend of alloy price?

Chairman Xue: At present, the supply of alloy is slightly oversupplied. Iron and steel enterprises have not fully recovered and the alloy stocks are high so the purchase has been delayed, the demand is obviously not strong. The production rate of alloy production enterprises is a little high and the reason is that the environmental protection restriction in Ningxia Province last December caused the price of alloy to jump, which caused the resumption of production of other discontinued enterprises. And since December, manganese ore prices at spot are relatively low, the alloy enterprise have some profit, so they do not want to or not take the initiative to stop production, which will inevitably lead to high alloy production capacity. The supply of alloy is large, and the demand for manganese ore is booming, which leads to the decrease of spot stock in the port and the high price. But the price of the alloy has been falling since December, and the highest price is 9,600 RMB/t in December. Then the price falling to 9,000 RMB/t, 8,400 RMB/t, 8,600 RMB/t. However the price of the carbonate manganese ore has been rising from $5 to $7.9 which will cause great pressure and risk to the alloy enterprises. Since the beginning of May, the high price of ore has arrived, and the cost of the alloy will rise again. If there is no obvious increase in demanding, it will inevitably lead to the price inversion of the alloy. Only in May and June, due to the market some enterprises reduce production or stop production. If the price of the alloy is seriously inverted, it will reverse the production of ore alloy, reduce the demand of manganese ore, and reverse the rational return of manganese ore price. At that time, supply and demand balance, manganese industrial chain can return to normal orbit.

  • [Editor:yuyunqing]

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