The buzz in the bulk ferroalloy market is DJJ and its offering of South 32’s manganese products in the US. While no one disputes that DJJ is qualified to sell the products and is very knowledgeable about the manganese, it is that DJJ is owned by Nucor, which is not only South 32’s largest US manganese customer but also a major supplier to all the North American steel mills.
In the past, Nucor often included a line in their bulk ferroalloy tenders that which included DJJ getting material for resale. In almost all case, the suppliers agreed to sell to Nucor but didn’t offer any material to DJJ, citing a conflict of interest. “Why would I sell to DJJ so they could use the same material against me,” one merchant told me. One merchant said that when he sold to Nucor, the purchase order was sent from DJJ which theoretically made Nucor privy to all the sales information including price; it is not known if a Chinese wall has been erected between DJJ the trader and DJJ the supplier to Nucor.
Now other US steel mills have expressed concern, saying that Nucor could have an direct impact on their sales price and any indexes and that at the sale information could be shared with Nucor, a direct competitor.
How this plays out is anyone guess, but it does create a lot of chatter.