Chinese antimony prices have declined sharply over the past two weeks on a lack of demand from domestic and seaborne consumers, although ore feedstock availability remained tight because of dwindling resources in China and reduced imports.
Argus last assessed prices for 99.65pc grade metal at Yn56,000-57,000/t ($8,723-8,879/t) ex-works on 18 May, the lowest since 25 February, down by Yn4,000/t from Yn60,000-61,000/t on 13 May. The market hit an eight-year high of Yn70,000-71,000/t on 11 March on a supply squeeze and renewed restocking demand, and started to fall from the middle of March following a slowdown in purchases from downstream consumers.
Prices are likely to fall further in the short term, with more traders eager to destock for profit-taking and generating cash given weak buying interest from the plastic and rubber industry. The market is expected to gain support from the shortage of ore and metal supplies, which may offset weak demand, following this round of destocking.
The range for 99.5pc grade trioxide dipped to Yn53,000-54,000/t yesterday, the lowest level since early March, from Yn56,000-57,000/t on 13 May. Many trioxide producers reported flat demand from the downstream flame retardant, plastic, rubber and catalyst industries, where consumers are buying feedstock for small volumes only for prompt demand in May. Some producers have reduced their offer prices to attract orders against limited demand this month.
The one-month environmental inspections in main production areas of Hunan and Yunnan provinces ended after the 1-5 May labour day holiday, but only 2-3 smelters in the production hub of Lengshuijiang city restarted partial or full production. The country's largest antimony producer, the state-controlled Hsikwangshan Twinkling Star, remains out of its metal and ore production without a restart date.
Chenzhou Mining, the second largest antimony producer in China, has maintained regular operating rates with a target of producing 34,967t of antimony products in 2021, compared with 35,430t in 2020. The firm has a 20,000 t/yr capacity for antimony metal and 20,000 t/yr for antimony trioxide.
China's antimony concentrate imports totalled 7,064t during January-March, down by 55.13pc from 15,743t a year earlier, as the Covid-19 pandemic in some supplying countries continued to pressure production and shipments. Shipments in April and May would remain low, according to market participants.
China produced 8,800t of antimony concentrate in the first three months of 2021, down by 18.53pc on the year. Antimony metal output during January-March totalled 14,742t, down by 12.5pc from 16,847t in the corresponding period of 2020, according to statistics from China's nonferrous metals industry association.
Operations have varied between metal producers and traders over the past two weeks, although the shortage of ore supplies has yet to ease. Most metal producers are not keen to quote prices and close sales because of low production, but traders are keen to destock at lower prices given persistently low buying interest from consumers in and outside of China since April.
