(2009-10-13)12 Oct 09 – The fatal mine accident in Lengshuijiang, Hunan province on 8 October has been stimulating local antimony producers to drive their offers up drastically over the past few days. For fear that the government would shut down all the smelters nearby for safety concerns, many producers either hold back from offering or start to quote as high as RMB43,000-44,000/t (USD6,296-6,442/t) ex works for antimony ingot and RMB39,000-40,000/t (USD5,710-5,857/t) ex works for antimony trioxide. In the meanwhile, consumers take a wait-and-see approach as most of them cannot adopt themselves to the surprisingly high increase in price.
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A Hunan-based antimony ingot producer has ceased offering since last Friday. "We have to be cautious about selling our stocks because once we are required to halt production, the price is bound to rise further," said the source, revealing that as of the end of last week, the production in Lengshuijiang has not been affected by the accident, but most producers in the region are ready to close down to be inspected.
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The source has some antimony concentrate in stock which is enough to produce around 100t of antimony ingot and also holds a stock of 30-40t of antimony ingot. The source revealed that their last deal was concluded at around RMB39,500/t (USD5,783/t) ex works before the National Day holiday for antimony ingot 99.65%min. "We heard that some producers have lifted their offer to RMB43,000-44,000/t (USD6,296-6,442/t) ex works and some quote as high as RMB45,000/t (USD6,589/t) ex works, but I don't think they have real intention of selling, and I'm sure consumers cannot accept such high prices for the time being," said the source.
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A Guangdong-based antimony trioxide producer also plans to not make offers until the market trend get clear. "We cannot get antimony ingot from our suppliers in Hunan, most of whom have suspended selling after the accident happened," said the source.
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According to the source, the company is running normally at the moment with an output of around 200tpm for antimony trioxide. Its stock for antimony ingot can meet their demand for production for another four to six weeks.
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"Since we cannot guarantee the supply of raw material in next one or two months, we're only going to take selected orders from our long-term customers," said the source. Like many antimony ingot producers, the source does not know how to quote for antimony trioxide, either. He added that, "We're fulfilling some contracts signed at around RMB36,000/t (USD5,271/t) ex works in the second half of September, but now we have to quote RMB40,000/t (USD5,857/t) ex works if we receive inquiries."
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Sources believe that the antimony products market will keep stagnant in the following one or two weeks with offering prices soaring but few deals concluded. They do not think it easy for end users to accept prices of RMB43,000-44,000/t (USD6,296-6,442/t) ex works and RMB39,000-40,000/t (USD5,710-5,857/t) ex works respectively for antimony ingot and antimony trioxide. Some of them worry that the dramatic price increase may slow down the market demand, which will probably force producers to lower their prices again.
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