Manganese market stable in Q3 but expansions may pressure recovering prices

The world's top manganese producers saw a stable but tight market in the quarter ending Sept. 30 after the return of a major supplier in May, but planned expansions could put recovering prices under pressure.

South32, the world's largest manganese producer in 2024 according to S&P Global Market Intelligence data, resumed export sales in May at its 60%-owned Groote Eylandt Mining Co. (GEMCO) unit in Australia's Northern Territory. GEMCO was suspended in March 2024 due to significant cyclone damage.

The manganese price was up 6% year-to-date at $4.18 per dry metric ton unit on Oct. 31, compared to $4.11/dmtu a year prior, according to Market Intelligence data.

"Through this quarter we saw a slight strengthening in manganese prices and pretty good downstream demand from a manganese alloy perspective," Brad Rogers, managing director and CEO of Jupiter Mines, told an Oct. 31 results call for the quarter ending Sept. 30.

This "meant that relatively strong supply, including GEMCO reentering the market and good volumes out of South Africa, were consumed by the market, and prices reflect that. So we're in a stable market right now. Prices have been range trading within a relatively narrow range for the last few months," Rogers said.

On the day of the call, manganese prices were "sitting just above four-year average levels," Rogers said.

Tight surplus

"The global [manganese] ore supply/demand balance remained in slight surplus" during the quarter ending Sept. 30, Eramet's Oct. 30 report for the quarter ending Sept. 30 said.

Chinese port ore inventories stood at 4.6 million metric tons by the end of September versus 4.5 million mt at the end of June, "equivalent to around eight weeks of consumption," according to Eramet.

Global manganese ore production fell 1% year-on-year to 5.3 million mt for the quarter as output from South Africa -- which still accounts for nearly half of seaborne production -- dropped 2% but "remains at a high level," Eramet said.

In Gabon -- which in June announced a ban on crude manganese exports starting Jan. 1, 2029 aimed at promoting local processing -- production fell 29% during the quarter ending Sept. 30. This reflects "the decline in volumes at Comilog [in France] and other producers," while Australian volumes "normalized following the resumption of exports by a major producer," Eramet said, referring to GEMCO.

Overall, global manganese ore consumption rose 8% year on year to 5.2 million mt for the quarter ending Sept. 30, amid "sustained manganese alloys production, particularly in China. This has led to an increase in manganese alloy inventories among Chinese producers since the beginning of the year, in a local context of flat to slightly declining steel production," Eramet said.

Global production of carbon steel, manganese's main end-product, was 454 million mt for the quarter ending Sept. 30, which was "relatively stable" from a year prior, Eramet said.

"Chinese production, which still accounts for more than half of global steel output, was stable compared to a particularly low Q3 2024 performance," the company said, while India's production rose 12% and North America's was up 4%, the latter due to "trade measures."

However, steel production fell 6% in Europe which is "faced with steadily declining demand and sustained pressure from imports," Eramet said.

Price warning

Ricardo Jose, COO of Consolidated Minerals, also sees the market having stabilized, but warned that it may not stay that way for long given his company's plans to expand in the coming years, along with others in the market.

Jose pointed to the potential for Eramet to increase production from Comilog "if they manage to unlock their logistics capacity," while Consolidated Minerals will lift production from Woodie Woodie in Western Australia from 1.3 million mt in 2024 to 1.5 million mt in 2025.

Jose said Consolidated Minerals plans to boost output to 1.8 million mt in 2026. Then, through development of two additional Pilbara mines in Balfour South and Utah, production is set to reach 5 million mt by 2030, to meet demand from parent company Ningxia Tianyuan Manganese Industry (TMI).

Manganese production in Ghana, where TMI also operates the Nsuta mine, is expected to rise 60% from 2024 to 8 million mt in 2025, the Ghana Chamber of Mines confirmed in June.

This planned growth in production by Consolidated Minerals and others "can only lead to an oversupply, leading to a reduction in price, and somebody will have to drop off or revise their cost structures," Jose told Platts, part of S&P Global Commodity Insights.

"Demand of manganese in the battery market and clean energy markets has not translated into a price increase ... [but] there's likely to be an increase in steel requirements from China and from Central Europe with the race towards producing more weapons, unfortunately," Jose said.