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When compared to previous years’ results, Manganese ore output has risen considerably in 2010. As production of manganese rises, so are the prices.
Vivien Diniz – Exlusive to Manganese Investing News
When compared to the previous years’ results, manganese ore output has risen considerably in 2010. However, despite rising demand for steel in countries like China and India, the price of manganese suffered slightly in June to trade around US$2,600/mt. From September to November 2010, prices for manganese increased from the previous lows reached January and February—reflecting the climb seen earlier in the year— to resume trading at around U.S. $3050/mt.
Since then, the demand for steel has steadily climbed, edging the price of manganese higher to sit currently at around US$3,200/mt.
Earlier this year, it was forecast that China’s steel requirements could climb higher than 579 million metric tonnes for 2010. By the tenth month, China’s steel import came to 503.3 million mt of iron ore, a slowdown of 2 percent compared to 2009. Steel Guru reported that “As far as China continues to increase their production of crude steel, an excess on supplies of manganese ores will be not felt by the market but, when the production of crude steel in China is reduced, the increased quantities of manganese ores are thought to put a pressure on the market as an oversupply.” For2011, analysts predict China will see a 15 percent increase in iron ore imports. Ultimately, this will bode well for the demand of manganese as a component of steel manufacturing.
Most of the world’s manganese supplies rest in South Africa, which houses 80 percent of global manganese reserves and resources. However, the nation contributes only about 15 percent of total global manganese production. In comparison, China holds less than 5 percent of total global manganese reserves and resources, but produces more than 35 percent of of global manganese.
Yet, demand for steel, particularly out of Asia, has created a greater need for manganese ore. This is prompting companies to look to South Africa as an outlet for their production. Australian mining company, Jupiter Mines Limited (ASX: JMS) reported on November 9th and increase at its South African Tshipi Borwa Project (formerly Tshipi Manganese Project) of 145mt of manganese ore at a 31.75 percent grade, which is in addition to the current mineral resource estimate of 163 million tonnes.
Manganese ore production in India is also moving towards South Africa after MOIL. Ltd’s initial public offering that raised $274 million. K.J. Singh, chairman and managing director at MOIL was quoted as saying that the company is looking to acquire mining properties in South Africa, Congo and Turkey as the demand for manganese by Indian steel producers is expected to rise in the near future. MOIL is looking to boost its manganese output to 1.5 million tons per year by 2015-16 from the current output of 1.1 million tons.
