Maybe some light at the end of a very dark tunnel as Mn ore prices move up higher. Obviously South African companies like JMS who own 49% of the Tshipi mine who produces 3.5 million tonnes annually will benefit the most. This could also be a good opportunity for E25 as even with its high cost production the low Aussie dollar will help. The question is whether E25 can get a move on and take advantage of the current situation. This is where SA miners like tshipi will benefit as every 10c dmtu increase results in US$13 million more profits, so if prices move up $1/dmtu you can see this is a game changer for Mn ore producers.
Lets hope E25 can get rolling too. I've changed my sentiment to BUY. E25 is cheap if it can get moving and start shipping ore.
Suspension at South32’s GEMCO manganese ore unit rewrites demand patterns in Asia
The suspension of South32’s manganese ore operations at Groote Eylandt Mining Co (GEMCO) in Australia has been changing demand patterns among manganese ore buyers in Asia and this will benefit other manganese ore miners, market participants said on Wednesday April 24
April 26, 2024
By
Holly Chant,
Tina Tong, and
the Fastmarkets team
Critical minerals Ferro-manganese Manganese Manganese ore Minor metals Ores and alloys Silico-manganese
Manganese smelters in Asia have been looking for alternative supplies of
manganese ore since late March, according to market sources.
Manganese ore supplier South32 on March 18 announced the suspension of operations at GEMCO after tropical cyclone Megan made landfall in the country’s Northern Territory.
Around a month after the suspension, on April 21, the mining giant announced in its quarterly report that GEMCO
export sales and wharf operations could remain in suspension until the third quarter of the company’s current financial year, which would be January-March 2025.
GEMCO is a significant supply source for Asian manganese smelters. Its output includes silicon-manganese, ferro-manganese and electrolyzed manganese, which products go to countries such as China, India, Japan, South Korea, Indonesia and Malaysia.
Buyers look for alternative supply, adjust ore blends
Manganese smelters in Asia have been looking for other manganese ore supplies to offset the loss of GEMCO material, or have been making adjustments to reduce the amount of high-grade manganese ore in their production blends, industry sources said.
Regions which do not have manganese ore stocks, or have low port stocks, must find substitutes or stop production.
“Our plant has been starting to inquire with a **onese manganese ore miner,” one smelter in Southeast Asia said, “but we are also evaluating the economics if we use a smaller share of high-grade ore and more lower-grade materials.”
Some end-users had previously told Fastmarkets that they typically blend high-grade manganese ore with lower-grade South African ore to produce silicon-manganese.
“I heard that a manganese smelter in Southeast Asia, which mainly uses Australian manganese ore, has announced that it will halt production soon,” an international manganese ore seller source said.
Buyers in South Korea and Japan were said to be keeping an eye on Chinese manganese ore port stocks, due to the high availability of manganese ore at nearby Chinese ports, market sources said.
“South Korea and Japan reacted quickly to the suspension announced in March,” the international supplier said, “but now, Chinese portside sellers are also concerned about the reduced supply. They have stopped quoting offers to the market, so it is not a solution for buyers in South Korea or Japan.”
Due to the suspension at GEMCO, which will last longer than many in the market expected, Chinese manganese smelters have started to look for more materials, despite existing high port stocks of both high-grade manganese ore and lower-grade materials, market sources told Fastmarkets.
According to a port contact, there were 1.80 million tonnes of South African manganese ore stocks, 780,000 tonnes of Australian ore and 820,000 tonnes of **onese ore at Tianjin port on April 22.
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Opportunities for other miners, but not easy to fill market gap
News of the estimated one-year loss of GEMCO supply fired-up manganese ore
market prices, to the benefit of existing suppliers, due to the increased competition. It also sparked market chatter about the re-emergence of miners that had previously stopped or reduced output, market sources said.
One mining market participant said that while the bulk of GEMCO material went to China, buyers in other regions would also need to replace that feed.
“They were supplying [other] regions and now those places have to buy elsewhere,” the same producer source said. “[Those] buyers have been trying to secure ore, supporting higher prices.”
The prices of both high-grade and lower-grade manganese ore have been rising in recent weeks, after Asian buyers accepted higher offers.
The increases continued in the week ended April 19. Fastmarkets calculated its weekly
manganese ore high grade index, cif Tianjin, at $4.86 per dry metric tonne unit (dmtu) on April 19. This was up by 1.25% from $4.80 per dmtu on April 12 and by 13.29% from $4.29 per dmtu on April 5.
Fastmarkets’ weekly
manganese ore index, 37% Mn, cif Tianjin, was calculated at $4.22 per dmtu on April 19. This was up by 0.24% from $4.21 per dmtu on April 12 and by 7.3% from $3.93 per dmtu on April 5.
“Even [as] the price of high-grade manganese ore from **on rises quickly, buyers in India conclude deals [equally] quickly,” a Malaysian smelter source said.
The higher manganese ore prices were also attractive to emerging miners which may resume production to secure market share, according to sector sources.
“I heard that miners in Brazil and Cote d’Ivoire are starting to quote to Chinese buyers,” a Chinese manganese ore trader contact said.
But there were still problems for these miners in entering the market quickly.
“Problems – such as whether smelting ovens can technically switch to other miners’ [product] and how long these emerging miners take to ramp-up operations – are still unpredictable,” the Chinese trader added.
“I know the deposit stopped producing early this year,” one contact said, whose company owns a manganese ore project in southern Australia, “and they haven’t decided to resume operations so far, but are keeping a close eye on the market demand and price movement.”
(20min delay)
