Manganese needs disciplined supply approach – South32
CAPE TOWN (miningweekly.com) – Mining is good for the world if done sustainably, South32 CEO Graham Kerr said on Monday.
Speaking at the Investing in African Mining Indaba, Kerr said the current challenge was around excess supply, which was putting long-term sustainability at risk.
The lack of industry discipline had resulted in oversupply and the supply side needed to respond and to take action.
South Africa’s manganese supply growth had outpaced demand and with steel demand weakening, supply would need to continue to adjust.
The last thing that South Africa needed was to increase production capacity as the market dynamics had changed fundamentally.
Manganese participants had a role to play in responding to market fundamentals and the industry needed to take a disciplined supply approach.
The main driver for manganese ore was steel production, where there was no substitute for it and manganese demand growth was thus roughly in proportion to steel growth, which is currently muted.
"The challenge for manganese has ben the fragmented growth in South Africa's Kalahari basin over the past five years," Kerr said, adding that the industry could not depend on quick recovery has market fundamentals had changed.
"The industry needs to take rational decisions and take a disciplined supply approach."
Most company time is spent on optimising existing aluminium, coal, manganese, nickel and silver operations and is committed to taking action to emerge stronger when markets improve.
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