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To: LoneClone who wrote (141060)	4/7/2020 5:52:19 PM
From: LoneClone	Read Replies (1) \| Respond to of 193231

Manganese: South 32 seeks clarification on South African mine shutdown roskill.com Posted 6th April 2020 in ?Industry news. By Ramsey Yavuz South 32’s manganese operations have been moved to care and maintenance, while its coal and aluminium operations could be exempt from the mandatory 21-day countrywide shutdown in response to COVID-19. The company is working with the South African government to determine the impact of an exemption on its coal and aluminium businesses; it provides the country’s power sector and Eskom’s generation network. Roskill View The manganese market, oversupplied and under-consumed throughout 2019 and early 2020, is underpinned by the indicative high stockpiles at major Chinese ports. Over the period January to February 2020, manganese ore imports were down 16% to 4.5Mt according to GACC (China’s General Administration of Customs) as domestic importers reduced their orders and warned miners to adjust China-bound shipments in an already subdued market. South Africa has joined the latest jurisdictions to impose a nationwide lock-down affecting the outlook for South 32’s operations alongside other key manganese producers entering force majeure. South Africa accounts for 40-50% of global manganese supply, and the lockdown should have a tightening effect in the manganese market in the short term, as South African exports already fell by 17% down to 900kt levels for December and January 2020. On the demand side, steel mills in China were placed on care and maintenance in the lead up to Chinese New Year, a period of seasonally low production levels. The lack of access to raw materials that followed the COVID-19 outbreak in China was an issue for steel mills as China enforced a nationwide lockdown that brought with it logistical restrictions. Chinese steel mills are taking a cautious wait and see approach on production levels to preserve margins and control inventory purchasing as local market demand begins to come back, while international demand for Chinese steel deteriorates. In the likelihood that manganese ore sales will wane while COVID-19 squeezes cashflow liquidity downstream of steel mills, dampened market conditions look set to continue over Q2 and into Q3. The knock-on effect of weak downstream activity is rippling through seaborne cargoes that have dropped in value since entering Chinese ports. Manganese prices have not received significant support from the resumption of downstream activity in China and have been moving sideways since mid-March in the range of US$3.85-4.00/t for ore grading 36-38% Mn on a CIF China basis. Given the prompt resumption of steel mills in China, there will be incremental rise in demand over Q2 from China as steel mills come back into production and inventories are drawn down. Roskill’s Manganese: Outlook to 2029, 15th Edition report was published in September 2019 and provides analysis on supply, demand, trade, prices, cost curves and forecasts. For more information or to subscribe click here. Contact the author This article was written by Ramsey Yavuz. Please get in touch below if you wish to discuss further: Contact the author