Figure 1:Top 10 Mn ore producing countries in 2019 (International Manganese Institute, 2020)

South Africa’s Manganese mining takes place predominantly in the manganese rich Kalahari manganese field (KMF) of the Northern cape, which is home to 74% of the world’s known manganese resources and 30.2% reserves (Mineral Council, 2020).  Manganese mining in the country has seen tremendous growth over the last decade of as much as 9.6% Compound annual growth rate (CAGR) and an averaged 4.5% over a longer period dating back to 1990.

Two main types of ore with varying grades are mined in the KMF, namely the Mamatwan low grade type (less than 40%Mn) ore and Wessels high grade type ore (above 44%Mn). The Mamatwan and the Wessels ore type have grades ranging between 20%-40%Mn and 45-60%Mn, respectively. It is however important to note that majority of mining operations take place in the low grade Mamatwan ore type with the Wessels type ore only making up 3% of the orebody6,7. South32(Hotazel Manganese mines), Jupiter (Tshipi e Ntle), Assmang Limited, United Manganese of Kalahari (UMK) and Kalagadi Manganese listed in no order hold dominance in manganese mining in the country.

Manganese demand

As much as 90% of global manganese consumption is by the steel industry with remaining percentage being usage in battery cathodes, chemicals, fertilizers etc. Manganese is vital to the steel industry because;

  • manganese is an essential alloy that helps convert iron into steel.
  • As an alloy it decreases the brittleness of steel and imparts strength
  • Though 6-9kg of manganese is used per ton of steel, it is however irreplaceable.

Thus, due to the consumption of the Mn mined by the steel industry, the price of Mn tends to follow the price direction set out by the price of steel.

Manganese beneficiation for the steel industry

The mining of Manganese ore serves as the primary stage termed raw material in the beneficiation stages in figure 2 as defined by (Maia,2015).

Figure 2: Different beneficiation stages of the manganese value chain in the steel industry(Maia, 2015)

The next progression is the beneficiation stage 1, where Mn ore is smelted into three critical manganese alloys namely, high carbon ferromanganese (HC FeMn), Refined ferromanganese (RF FeMn) and Silicomanganese (SiMn) alloys. In South Africa, the smelting of manganese ore into ferromanganese and silicomanganese is done largely by four producers namely, South32 metalloys. Assmang, Transalloys and Mogale alloys. South32 metalloys and Assmang are in the production of ferromanganese with the latter 2 in the production of Silicomanganese.

Mineral Council, (2020) indicates that the Manganese alloys sub-sector has seen negative CAGR of 1.36% between 1990-2019 and a closer look at South32 Metalloys (one of the largest ferromanganese smelters globally) production figures from 2015-2019, reveals negative CAGR of a staggering 22%. Despite the period between 2010-2019 seeing near 10% CAGR of the Mn ore mining, it did not however translate to improved production capacities in the ferromanganese downstream. Figure 3 from the IMni, indicates lack of presence of South Africa’s Manganese alloy productions on a global scale;

Figure 3: Ferro and Silicomanganese production by country in 2019 (International Manganese Institute, 2020)

To put things into perspective, the total global production of HC FeMn, Ref FeMn and SiMn for 2019 were 4,4mt, 1,4mt and 18mt, respectively indicating large that percentages of the Mn ore is exported rather than beneficiated in the country. Despite the comparative advantage of producing more Mn ore than any other country, South Africa is however not a forerunner in the global production of Manganese alloys along with China and India as seen in figure 3.

Research has shown that the major declines in the local production of Manganese alloys over the last decade were due to shutdowns of smelting operations attributed mostly to depressed commodity prices resulting from lower demand for manganese ore and alloys. The rise in electricity costs along with regular power outages further compounded the misery of smelting operations. The price of Eskom’s electricity supplied to the mining industry increased by as much as 120,67% at an average annual increase of 13,4% over the period (Eskom, 2021). These factors combined made smelting operations at large capacities uncompetitive and resulted in reduced outputs.

Market Outlook

The mineral council in its 2019 facts and figures report identified the arresting of production declines in ferromanganese and preservation of current capacities as top priority before any solutions to grow the industry is considered. The organisation goes further to encourage the sintering processing of low-grade Mn (less than 38%) to high grade (above 44%) as means of increasing industry value due to higher returns for high grade sintered Mn ore over its low-grade counterpart. With the discoveries and suggestions offered around how to preserve and add value to the ferromanganese industry with demand supported by a forecasted 2% annual growth in the steel industry, the vision can be carried forward with government’s buy in.

Government’s buy in into the vision of having the country’s ferromanganese industry being globally competitive and dominant alongside China and India can be expressed in the form of time efficient processing of renewable energy projects applications to supplement Eskom’s base load, incentives and/or tax breaks for smelting operations. The Northern Cape because of its exposure hours to sunshine during the summer period is said to be the most ideal place for solar energy storage and such energies will go a long way to cushion operations against intermittent power disruptions and to some degree rising electricity costs.

Incentives and/or tax breaks have proven to work elsewhere i.e., India’s gold refinery, where the government in particular promoted gold refining in the country by allowing doré, a semi pure alloy of gold and silver to be imported with a lower import duty compared to refined gold. These along with other initiatives saw gold refining in India grow from 300t with 5 refineries in 2013 to an estimated 1,300t-1,500t with some 24 refineries today (Metals Focus, 2021). Thus, the above proves the impact that government’s buy in has on development and spurring growth of an industry. The kind of growth if not more that the Mn beneficiation industry needs to asset its dominance on a global stage.

The call to action for prioritization of the ferromanganese alloys production as means of addressing prevailing conditions operators are subjected to, resulting in lower outputs year on year speaks of the need to capitalize on the endowment of the country’s resources. In the process, employment opportunities are created for surrounding communities to share of the riches of the land, create value for the state through income generation by royalties and/or taxes and development of infrastructures in key areas. In parting, our mineral wealth should be used for the benefit of the communities at large and for making South Africa a world class nation that unequivocally and unapologetically should be.

References

1. Eskom, 2021. Eskom’s Tariff history. [Online]
Available at: https://www.eskom.co.za/CustomerCare/TariffsAndCharges/Documents/Historical%20average%20prices%20and%20increase_v20200115_13h00_no%20links_External.xlsx

2.International Manganese Institute, 2020. ImnI Annual reports. [Online]
Available at: http://www.manganese.org/wp-content/uploads/2019/05/IMnI_Statistics_2020.pdf

3.Maia, J., 2015. Unlocking economic value through the development of mineral value chains in South Africa. s.l., s.n., pp. 1-22.

4.Metals Focus, 2021. Metal Focus India focus monthly. [Online]
Available at: https://mcusercontent.com/65e61541e75b9ce36f9b00274/files/d5fa3216-3168-4509-a3c2-124cbd8369ac/India_Monthly_February_2021.01.pdf

5.Mineral Council, 2020. Mineral Council facts and figures 2019. [Online]
Available at: file:///C:/Users/admin/Downloads/facts-and-figures-2019.pdf

6.N. Van Averbeke, A. Harding, J. Duval, P. Mwape, and J. Perold, “South Africa’s Mineral Industry,” pp.1–187, 2005.

7. B. Cairncross, N. Beukes, and J. Gutzmer, The Manganese Adventure – the South African Manganese Fields. Associated Ore & Metal Corporation, 1997.

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