The narrowing gap between seaborne manganese ore prices and spot prices in China will continue to taper amid the downward correction in the record-high premium for seaborne material in March, market participants said.
It is likely the narrowing will be due to a combination of miners cutting seaborne offers amid mounting resistance from buyers and portside cargo holders raising prices following stronger spot demand and rising costs, multiple sources said.
Seaborne manganese ore prices are typically lower than - or at parity with - spot prices at Chinese ports, reflecting the prompt availability of portside cargoes and providing a margin for trading houses.
Although it is not unusual for seaborne prices to rise above portside prices temporarily - especially amid tight overseas supply - the current premium for seaborne material and the length of time it has been elevated are unprecedented, market sources said.
Since mid-January 2021, seaborne prices have been above portside prices with the gap widening to a record size in mid-March when the seaborne market hit a nine-month high and portside prices slid.
Soaring freight...