Manganese Market Fluctuates Amid Supply and Demand Changes

Manganese market fluctuations continue, affecting stock prices amid shifting demand. Analysts project an eight-fold increase in demand for manganese due to electric vehicle batteries by 2030. Both South32 and Eramet could see stock price impacts.

Date: 20-03-2025

AI Rating: 6

Market Overview
Market volatility in manganese production is highlighted by the recent surge in prices due to Tropical Cyclone Megan damaging the Groote Eylandt Mining Company in Australia. However, the subsequent decline in prices suggests a struggle between supply and demand, reinforcing volatility in the market.

Manganese Demand and Future Outlook
Analysts are optimistic about manganese demand in the electric vehicle (EV) sector, predicting an eight-fold increase by 2030 as more lithium-ion batteries are required. This possibility may strengthen the investment case for companies involved in manganese production.

Company Implications
South32, a major player in manganese mining with significant operations in South Africa and Australia, holds a 44% indirect interest in the South Africa manganese operation. The company's output and stock might be sensitive to both the natural events affecting production and the broader market demand for EVs. Regulatory issues, competition from alternative supply chains, and global market supply could affect its profitability. Additionally, Eramet, another key player, paused production at Moanda in Gabon due to market oversupply, which adds complexity to its operations and may impact its stock value.

Production Statistics
In 2024, South Africa led with 7.4 million metric tons, followed by Gabon (4.6 million metric tons) and Australia (2.8 million metric tons). The fluctuations in production levels can greatly affect profitability for these companies, leading to potential changes in stock prices.

Investor Consideration
Investors should be cautious due to the fluctuating manganese prices driven by external factors like natural disasters and changing demand patterns. Scrutinizing company reports and market analyses focusing on EPS, revenue growth, and net income could help guide investment decisions.

Stocks: S32 AAL VALE