A reduction in production of crude steel on a global scale in 2009 pursued the manganese market. The world output of crude steel in 2009 was 1,220 million tonnes, having decreased by 8% compared with that in 2008, and Japan produced 87.53 million tonnes of crude steel in 2009, which had a considerable decrease of 26.3% compared to that in 2008.

The output of crude steel in Europe and the USA in 2009 also had a large decline and only China increased their production of crude steel in 2009 by 13.5% to 568 million tonnes but this expansion of the production in China was diluted by a reduction in production of crude steel on a worldwide scale. The reality in the western world had been felt as the output of crude steel in 2009 decreased by approximately 30% from that in 2008. This was an unprecedented case.

Manganese ferroalloys are consumed to produce steel but had been troubled with a decline of its demand caused by a depression of the steel market. However, the accumulation of manganese ferroalloys made in a prosperous time of 2007 to 2008 became a cushion and all producers in the western countries were able to avoid to go bankrupt. However, the distributors concerned had suffered in 2009 from the stocks arisen from excessive imports.

These excessive stocks of manganese ferroalloys had been mostly adjusted to a reasonable level in October to December quarter of 2009 but some of major trading companies in Japan had to reckon up an appraised loss of the stocks and were driven to be distressed together with a fall of prices for manganese ferroalloys in the international market. Since the excessive stocks of manganese ferroalloys had been reduced to a normal level as mentioned above, the actions to commence from the beginning of 2010 will become a new starting point for trading companies.

In case of silico manganese, which is a representative item of manganese ferroalloys, since the excessive stocks of silicomanganese in Japan had been revealed, a fall of price for silicomanganese accelerated and a basic recovery of the price has been rather carried over to January of 2010. In the course of time, price of silico manganese rose to a higher level of USD 2,450 per tonne CIF Japan in summer of 2008, when the market had a boom, but Indian silico manganese took the offensive for sales at a lower price than USD 1,000 per tonne CIF Japan in spring of 2009 and, therefore, Chinese silico manganese had faced an unexpected hardship.

For a reference, in 2008 when Beijing Olympic Games were held splendidly, the quantities of silico manganese supplied and consumed in Japan were imports: 353,000 tonnes, domestic production: 60,000 tonnes and total supply: 413,000 tonnes as against actual consumption: 355,000 tonnes. Consequently, by taking into consideration of a reduction of the stocks at steel mills, about 60,000 tons of silico manganese was a surplus in Japan.