consmin market update manganese chromite up

Consolidated Minerals Limited 05 April 2007

ASX / Media Release

5 April 2007


OPERATIONS AND MARKET UPDATE


Further to the announcement of 15 March 2007 regarding the impact of recent tropical cyclones, Consolidated Minerals Limited (ASX: CSM, AIM: CNM, FSE: CMN) today advised that normal mining and haulage operations have now resumed at the Woodie Woodie manganese operations following temporary disruptions associated with the March rainfall.

The abnormally heavy rainfall events resulted in approximately 10 days downtime for mining and haulage operations at Woodie Woodie and 2-3 days downtime for the treatment facility. The Company responded by treating more easily accessible but lower yielding alternative ore stockpiles during this period.

As previously advised, the Company confirms that the disruption to operations has not changed its FY07 manganese production guidance of 900,000-925,000 tonnes, which factored in potential wet season impacts.

The Coobina chromite operation also remains on track to achieve FY07 production guidance with only one day's production lost during the March rainfall events, as previously advised.

Market update and outlook - Manganese and Chromite

Consolidated Minerals' marketing team has recently returned from Ferro Alloy Conferences held in Hong Kong and Southern China, where negotiations commenced with customers for upcoming shipments of both manganese and chromite. Indications from these meetings are that the manganese and chromite markets are continuing to strengthen, following increases in manganese prices on a landed (CIF) basis during the March Quarter and strong chromite prices.

However, this positive upward trend continues to be partially offset by rising shipping freight rates and the strengthening Australian - US Dollar exchange rate, impacting the FOB prices, or the "net-back" prices, received by the Company. Freight rates have, on average, increased by 50% since June 2006 and currently the Australian Dollar has risen by approximately 7% against the US Dollar compared with the first half of FY07.

Based on current freight rates, the average FOB price received by the Company for manganese lump ore for the full 2007 financial year is expected to increase by between 8-10% on the average price received for the first half of FY07 (US$2.09/dmtu FOB).

The chrome ore market has also continued to strengthen on the back of strong stainless steel production in China, which increased by approximately 68% to 5.3 million tonnes in 2006.

The average FOB price received by the Company for chromite ore for the full 2007 financial year is expected to increase by approximately 6% on the average price received for the first half of FY07 (US$148 / tonne FOB), based on current freight rates.

Consolidated Minerals' Managing Director, Mr Rod Baxter, said "We anticipate receiving higher than expected prices for a number of forthcoming shipments, however, it is important to emphasise that the recent price gains in manganese and chromite have been partially offset both by the significant increases in shipping freight rates and the strengthening Australian dollar."



ENDS