Eramet's production and sales of manganese ore rise in Q1CY'24

Eramet, a leading producer of high-quality manganese ore, continues to make waves with its recent Q1 CY24 results. Operating the Moanda mine situated in Gabon, Eramet boasts an extensive network of processing plants spanning the globe. In their latest financial update, several noteworthy points emerged:

Manganese ore production up 76% y-o-y in Q1CY24

In Gabon, Camilog's manganese ore production was up by 76% y-o-y to 1.9 mnt in Q1 CY24 as against Q1 CY23, which was impacted by a landslide. Despite this significant boost in production, the rise in transported ore volumes and external sales volumes was more moderate, climbing by 21% and 27% respectively, reaching 1.6 mnt and 1.5 mnt respectively. These figures account for maintenance activities on the railroad line aimed at enhancing the transport capacity of the Transgabonese railway.

During the quarter, global manganese ore consumption held steady at 5.1 mnt, while supply decreased by 7% to 4.9 mnt. Brazil saw a significant 74% decline, while South Africa experienced a 12% increase.

Sales volume up by 22%

Sales for manganese ore climbed up by 22%, primarily propelled by a notable uptick in volumes sold externally, rising by 27% compared to Q1 CY23, which had been marred by non-recurring logistical incidents. However, this growth was somewhat tempered by an adverse price impact. Despite the increased sales volumes, the manganese ore segment faced challenges due to prevailing market conditions, reflecting a nuanced performance marked by volume growth and pricing pressures.

Manganese ore prices decline by 21% in Q1CY'24

The price index for manganese ore (CIF China 44%) averaged $4.3/dmtu during the quarter, marking a 21% decrease compared to Q1 CY23.

In Q1CY'24, the price index for refined alloys in Europe, including MC ferro manganese, plummeted by 21% to EUR 1,419/t, while standard alloys like silico manganese decreased by 5% to EUR 1,097/t compared to Q1CY'23. Nonetheless, these indices marked a notable increase from Q4CY23, buoyed by supply tensions exacerbated by the Red Sea crisis, causing delays in Asian deliveries.

Outlook:

The global demand for manganese ore may experience a slight decline due to anticipated destocking in China, coupled with a significant drop in supply from Australia.

Despite a forecasted 3% decline in the average manganese ore price index, potential price rebounds are anticipated.

Alloys demand remains steady, yet increasing supply in Europe could impact short-term prices. Gabon expects annual transported ore volumes of 7 mnt-7.7 mnt, adjusting production accordingly, while manganese alloys production is estimated at around 700 kt, subject to market conditions.