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Africa|Efficiency|Export|Financial|Logistics|Mining|Ports|Projects|rail|Steel|System|Transnet
africa|efficiency|export|financial|logistics|mining|ports|projects|rail|steel|system|transnet

Steps being taken to improve manganese export logistics – ARM

The control room at African Rainbow Minerals' Black Rock manganese ore mine in the Northern Cape.

The control room at African Rainbow Minerals' Black Rock manganese ore mine in the Northern Cape.

Photo by Creamer Media

4th March 2021

By: Martin Creamer

Creamer Media Editor

     

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JOHANNESBURG (miningweekly.com) – Steps involving the use of two ports rather than one, longer trains and increased rail wagon payload are being studied to improve the logistics surrounding the export from South Africa of manganese ore.

State-owned rail enterprise Transnet has put on hold the capital expansion plan centred on the Port of Ngqura, at Port Elizabeth, being the sole port for the export of manganese ore, and is now also including the Port of Saldanha.

African Rainbow Minerals (ARM) Ferrous Division CE Andre Joubert said in response to analysts and Mining Weekly following ARM’s presentation of record financial results and a doubled interim dividend declaration, that the current thinking of Transnet – which had ARM’s full support – was to provide dual rail routes to Saldanha as well as Port Elizabeth.

“Transnet has now come in with the longer trains and we’re also contemplating spending some capital to upgrade our private rail siding, because Transnet is now wanting to take 100 t payload wagons to Saldanha.

“The number of trains that come into our site will stay the same but the payload, which is currently 63 t per wagon, will then increase to 100 t per wagon, which is what the Saldanha line can take, and Transnet will come in with 160-wagon train configuration, which is exactly the same as the iron-ore, so we will then increase the efficiency of that line.

“We’re doing a feasibility on that now. We will have to upgrade our private siding to be able to take that 100 t payload and we’ll also upgrade our stacker reclaimer system to able to load,” said Joubert.

In the six months to December 31, ARM’s manganese headline earnings plunged 69% to R137-million in what has been a very buoyant period for other metals and minerals, particularly iron-ore, ARM’s headline earnings for which rocketed 99% to nearly R3-billion.

South Africa is said to be responsible for about 60% of international market supplies of manganese and to be endowed with the world’s largest known deposits of excellent quality manganese ore. Manganese is critical for the manufacture of steel and is expected to be buoyed by the global trends of decarbonisation, government stimulus packages and the electric vehicle surge.

Joubert said in response to Mining Weekly that Transnet was doing a lot of work towards opening up ports for the export of manganese ore against the background of the proportion of manganese exports currently being much lower than what the South African manganese ore reserves could allow.

“So, we’re still lagging in that regard,” said Joubert.

In the six months to the end of December, the earnings margins of manganese ore fell to 16%, which is 13% below the 29% margin of the corresponding 2019 period. This was so in spite of export sales volumes being 4% higher at 1 796 000 t and local sales volumes being 23% higher at 65 000 t.

Manganese export volumes are projected to be 3.9-million tonnes this year and next year, rising to four-million tonnes in 2023 and five-million tonnes beyond that.

ARM reported that manganese ore prices remained under pressure, with production volumes impacted by Covid-19-related absenteeism and delays with the commissioning of the Black Rock and Gloria projects, which were held back six months by Covid restrictions.

On-mine production costs increased by 18% on decreased production volumes and increased labour costs.

MANGANESE ALLOYS

The US dollar prices for manganese alloys were under pressure in the six months to the end of December.

Lower demand resulted in reduced production at Cato Ridge ferroalloys plant and production volumes at Sakura Ferroalloys, in Malaysia, were impacted by an unplanned shutdown owing to low ore stock levels.

Unit production costs at Cato Ridge increased on lower production volumes and lower ore prices resulted in unit production costs at Sakura being 1% lower. The Assmang investment in Sakura was impaired by an ARM-attributed R169-million

Edited by Creamer Media Reporter

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