GEMCO export sales and wharf operations to remain suspended until Jan-Mar 2025

This development has led to a tightening market supply and bullish sentiment among traders, despite the immediate aftermath not showing a price hike

China’s manganese markets have been heating up after South32 announced in its quarterly report on Sunday April 21 that Groote Eylandt Mining Company (GEMCO) export sales and wharf operations could remain suspended for about a year. Seaborne and port-side manganese ore prices have been rising in recent weeks since Cyclone Megan severely affected operations at South32’s GEMCO facility in Australia on March 16-17, leading to a suspension of operations on March 18.

South32 reported that record rainfall and the “second-strongest wind gusts in the past 20 years” resulted in widespread flooding across the island of Groote Eylandt and “significant damage” to critical infrastructure, including to the wharf and port, as well as a haulage road bridge connecting the GEMCO’s northern pits of the Western Leases mining area to the processing plant.

Market participants grew more bullish following the news that South32 expects to recommence wharf operations and export sales in January-March 2025 – the third quarter of the company’s 2025 financial year.

Market supply has been tightening, and port stocks were already lower, sources said on Monday April 22.

Contact us today to get full access to our maganese ore index. The index provides a fair and robust representation of the manganese ore spot market price.

Delayed market reaction after holiday period

While price increases did not immediately follow the weather event and suspension in March, there was a delayed market reaction in the week ending April 12 following public holidays and uncertainty over the estimated time of restoration for GEMCO operations.

The increase continued last week; Fastmarkets calculated its weekly manganese ore high grade index, cif Tianjin at $4.86 per dry metric tonne unit (dmtu) on April 19, up by 1.25% from $4.80 per dmtu on April 12 and by 13.29% from $4.29 per dmtu on April 8.

Port-side market prices of high-grade manganese ore also rose sharply following South32’s announcement, while sentiment was mixed amid traders and smelters, according to sources.

“We do have a jump in [port-side] prices of manganese ore [on Monday], and some sellers at ports have even stopped quoting after hearing the news of longer-than-expected operation suspension of South32’s GEMCO mine,” a Chinese manganese ore trader source said.

Fastmarkets calculated its manganese ore high grade port index, fot Tianjin China at 39.50 yuan ($5.46) per dmtu on April 19, up by 3.13% from 38.30 yuan per dmtu on April 12 and by 10.96% from 35.60 yuan per dmtu on April 8.

A manganese alloy producer source reported a price spike but said it was sentiment-driven, not demand-driven, adding that actual buying had not increased.

“The sentiment in the market was strong, with panic from both traders and smelters for reduced manganese ore supplies to secure manganese alloy production, but deals haven’t increased for Australian ore,” the smelter source said. “Let’s wait and see how far the news goes and how the market reacts later this week.”

GEMCO recovery

So far, South32’s operational recovery has focused on re-establishing critical services and dewatering mining pits, the company said.

“Engineering studies are under way on the [restoration of] wharf and haulage road bridge infrastructure… These studies will inform the final schedule and capital costs,” South32 said.

And alternative shipping options were being evaluated, which could establish “partial ore export capability in advance of the wharf restoration,” according to South32’s quarterly report.

South32 said its Australia manganese saleable production fell by 13%, or 352,000 wet metric tonnes (wmt), to 2,324,000 wmt in the nine-month period ended March due to the suspension of GEMCO operations.

The company’s 60% share in the facility produced 3,545,000 tonnes of high-grade manganese ore in 2023, according to the company’s latest yearly financial report.

Get access to all our market-reflective prices for the manganese ore market.

What to read next
Fastmarkets launched a new price assessment for MB-GER-0006 germanium dioxide, in-whs China, on Friday May 10.
Copper fabricators in China and the wider Southeast Asian region continue to feel the pain of high copper prices on futures exchanges and a lack of new orderbooks, with some having already asked for a postponing of shipments of long-term copper cathodes, sources told Fastmarkets in the week to Wednesday May 15
This legislation emphasizes the crucial role of graphite in electrification efforts and highlights the ongoing significance of both natural and synthetic graphite in the EU's green transition journey
Standard Lithium announced on Wednesday May 8 that it was forming a partnership with the multinational energy company Equinor to accelerate the development of its South West Arkansas and East Texas lithium brine projects in the United States
Recent weeks have seen a significant number of miners agreeing sales of copper concentrate to traders for one to four years of supply, Fastmarkets has learned
The copper market is facing a historical moment with Chinese smelters now paying premiums for raw material copper concentrate while selling their finished product at a discount, but participants point to easing concentrate demand in the second quarter as supportive for the market