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					                                                                            MANGANESE MATTERS
                                                                                                   June 22, 2010 - Issue n° 10


Article Index                               3



IMnI UPCOMING MEETINGS
                                                                   IMnI Held Its Most Successful Conference To Date
Board Meeting
Sunday, November 14, 2010
Intercontinental, Berlin
                                                                                                                                         th
Statistics Comm ittee Meeting                                   It was befitting that IMnI celebrated its 35 Anniversary in Paris with its largest
Sunday, November 14, 2010                                       turnout of delegates ever. There were 185 delegates in attendance for IMnI‘s
Intercontinental, Berlin                                           th
                                                                36 Annual Conference, which took place from June 11 through 13. There
REACH Steerco Meeting                                           were many key features that made the conferenc e such a success.
Sunday, November 14, 2010
Intercontinental, Berlin
                                                                Top-flight speakers…
M&C Comm ittee Meeting
Sunday, November 14, 2010
Intercontinental, Berlin                                        Kirby Adams, CE O of Corus, Jim Lennon of Macquarie and Robert Ward of
                                                                the Economist Intelligence Unit were only a few of the excellent speakers to
OHES Com m ittee Meeting                                        give pres entations. Robert Ward introduced the delegation to ‗CIVE TS‘, his
Sunday, November 14, 2010
Intercontinental, Berlin                                        list of countries to watch for future growth outside of the ‗BRIC‘ count ries. Jim
                                                                Lennon gave an all-encompassing paper on Mn and Kirby Adams enlightened
                                                                us on the future landscape of the steel industry. Among the other notable
                                                                speakers were José Carlos Martins of Vale, Charles -Edouard Bouée of
                                                                Roland Berger Strategy Consultants and Xin Yaoyuan of SMM Information &
                                                                Technology Co. Ltd. A wide range of topics were covered including energy,
                                                                shipping, health and safety and the Chinese domestic ore mark et. To see all
                                                                presentations, please visit:

                                                                http://manganese.org/events/past_imni_events/2010_imni_36th_annual_conf
                                                                erence_-_paris


                                                                Changes in Leadership…

                                                                After three fruitful years, Alastair Stalker stepped down as IMnI Chairman; he
                                                                remains on the Board. The General Assembly approved Peter Toth, of OM
                                                                Holdings, as his successor. Showing ambition right from the start, Peter has
                                                                asked all IMnI committees to launc h individual 5-Yr Plans to build on previous
                                                                achievements and ensure the Institute continues to identify and meet the
                                                                needs of its members. Paul Doetsch of BHP Billiton fills Alastair‘s seat on the
                                                                Executive Committee, joining Arnaud Tissidre of Eramet and the new
                                                                Chairman Peter Toth.


                                                                New Committee Members…

IMnI
17 rue Duphot
                                                                              EPD Division: Thomas Gluck, Baja Mining Corp.
75001 Paris                                                                   OHES Committee: G.P. Kundargi, MOIL
France                                                                        Statistics Committee: Denny Sabah, Ronly Holdings Ltd.
Tel : +33 (0) 1 45 63 06 34
Fax : +33 (0) 1 42 89 42 92
E- mail : info@manganese.org
Web site : www.manganese.org                                                                                                                                                   …/ …



            Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             1
  The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
          Technical Tour…

          Vale welcomed visitors to its HC FeMn plant in Dunkirk on Monday, June 14. Two presentations were
          given: one on the characteristics of the plant and the other on the freeze -lining technology recently
          installed. These were followed by a tour of the plant. The day ended with a Vale hosted lunch. Both
          presentations can be found though the link given above.


          Finally, IMnI extends its thanks to our sponsors and exhibitors…

          IMnI would also like to thank its members companies that supported the event by sponsoring part of
          the social program. Thanks to Ronly Holdings for sponsoring our Welcome Cocktail, Minera Autlan for
          sponsoring Lunch on the first day, FerroAtlantica for sponsoring Lunch on the second day and to
          Eramet and Vale for sponsoring the Ban quet Dinner at the Abbaye de Royaumont.

          The IMnI would like to thank the two companies that took out exhibition stands at the event. They were
          Harlan Laboratories and Euroports / CTB Magemon. To learn more about what these exhibitors have
          to offer your company, please visit our industry part ners and suppliers page by following this link :
          Mn Industry Partners and Suppliers Page




                                               Three Companies Apply for Membership

          Indian Mn alloy producer Team Ferro Alloys Private Limited has applied for Ordinary
          Membership. Established in 1998, Team Ferro Alloys is a privately held company with its head office
          in Nagpur. It produces HC SiMn and Low & Med Carbon FeMn. Director S andeep Goenk a has been
          appointed to represent Team Ferro Alloys in the IMnI.

          With the arrival of Team Ferro Alloys, our Indian membership now stands at 12.

                                                   *******************
          American junior Mn miner ACM Corporation has applied for Ordinary Membership. Founded in 2004
          and headquart ered in Quincy, MA, the company operates two mines; one in Burkina Fas o, the other in
          Mali.
          CEO Louis Slaughter will represent AMC.

                                                                                       *******************

          South African future miner Kalagadi Manganese Pty Ltd has applied for Ordinary Membership. The
          company, which plans to have its Umtu mine in the Kalahari in operation by 2012, has appointed Mrs.
          Daphne Mashile Nilosi as its representative to the IMnI. The company also has plans to build a HC
          FeMn smelter. Founded in 2007, Kalagadi Mn is owned jointly by Kalahari Resources (40%),
          Industrial Development Corp. (10%) and Arcelor Mittal (50%). In their application form, it was stressed
                            st
          that this is the 1 company in which black South A frican woman have a significant role.




          Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             2
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
                                                                           Metal Bulletin 3rd South African Ferro-Alloys Conference
                                                                           September 29-30, 2010 – Hilton Sandton, Johannesburg

                                                                           Ryan’ s Note s 2010 Ferroalloys Conference
                                                                           Oct. 24-26, 2010 – Hollywood, FL
                                                                                                           th
                                                                           Metal Bulletin 26 International Ferro Alloys Conference
                                                                           November 14-16, 2010 – Int ercontinental Berlin




          Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             3
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
                                                                                ARTICLE INDEX

          ASIA (OTHER)

                        IMnI‘s Annual Conference Was Held On 11th June At Paris .......................................... 18/06/10
                        S Korea KORES says eyeing Africa mines .................................................................. 17/06/10
                        Market tendency on imports of ferroalloys into Japan ................................................... 07/06/10
                        Korea to explore ocean for future natural resources ..................................................... 26/05/10
                        Malaysia: IFASB to Set Up Country‘s First Silico Mn Processing Plant ........................... 25/05/10

          CHI NA

                        BHP Billiton holds manganese ore prices in July, August .............................................. 18/06/10
                        IMnI conference: Chinese steel boom unstoppable ....................................................... 14/06/10
                        Chinese ferro-alloy out put up 6. 5% in May ................................................................... 11/06/10
                        Chinese ferroalloys weekly roundup ............................................................................ 03/06/10
                        BHP holds Mn offers to China steady for July, August .................................................. 03/06/10
                        Chinese ferro-alloys exports continue to struggle ......................................................... 31/05/10
                        Most of China's ferro-alloy capacity cuts to come from Mn, says CFIA ........................... 31/05/10
                        Minmetals Hunan shuts two SiMn smelters .................................................................. 24/05/10

          INDIA

                        India maintains status quo on ferro-alloy import duty .................................................... 21/06/10
                        Indian Market Report .................................................................................................. 15/06/10
                        Indian mineral production up 14.41% ........................................................................... 04/06/10
                        Rohit Ferro-Tech starts Mn alloy production at Haldia................................................... 01/06/10
                        Indian manganese mark et stable ................................................................................ 31/05/10
                        Rohit Ferro-Tech starts production at new 100% EOU unit at Haldia ............................. 31/05/10

          OCEANI A

                        Spitfire Resources Picks Up Tenements Near Woodie Woodie Manganese Mine ........... 22/06/10
                        Groote Resourc es Aiming To Become "Major" Manganes e Force ................................. 15/06/10

          EUROPE

                        European silico-manganese market up almost 5% ....................................................... 17/06/10
                        European SiMn market set to extend consolidation ...................................................... 10/06/10
                        European ferro-manganese market consolidates gains ................................................. 10/06/10


          CIS

                        Ukraine ferroalloys producers up output levels sharply from 2009 ................................. 09/06/10
                        ICDA - CIS gaining ferro-alloys market share ............................................................... 27/05/10

          AFRI CA & MIDDLE EAST

                        Union says hopes to reach deal with Eskom ................................................................ 21/06/10
                        Gabon to tale stake in France's Eramet ....................................................................... 17/06/10
                        China firm to build new manganese processing plant ................................................... 15/06/10
                        Trans net hopes to purs ue big commodity .................................................................... 10/06/10
                        South Africa boosts manganese, chrome production .................................................... 11/06/10
                        Jupiter advances manganese project in South Africa .................................................... 11/06/10
                        SiMn up as South A frica works through backlog ........................................................... 07/06/10

          Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             4
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
                        Ethan Minerals Commences Trial Mining At Zambia JV Manganese Project .................. 07/06/10
                        Mining injects US$2.9bn into economy ........................................................................ 02/06/10
                        Ivory Coast Mn ore shipments off 25% in Jan -Apr ‘10 ................................................... 01/06/10
                        S Africa transport strike may end on new deal .............................................................. 27/05/10


          AMERI CAS

                        US ferro-manganese mark et eases again .................................................................... 21/06/10
                        Brazilian steelmakers count electricity cost impact on alloys ......................................... 21/06/10
                        Vale mulls new ferro-alloy plants in Brazil .................................................................... 17/06/10
                        US silico-manganese market falls almost 10% ............................................................. 07/06/10
                        US ferro-manganese mark et drops under more offers .................................................. 03/06/10
                        DNS C announces amended offerings of stockpile metals ............................................. 01/06/10

          GENERAL INFORMATION

                        Ryan‘s Notes Weekly ................................................................................................. 21/06/10
                        Ryan‘s Notes Weekly ................................................................................................. 14/06/10
                        IMnI conference: Raw materials key for steelmakers – Corus........................................ 14/06/10
                        Global manganese alloy capacity utilisation to rise ....................................................... 14/06/10
                        MARKE T ROUND UP: Outside forces may force up ferro-alloys prices ......................... 11/06/10
                        BHP Billiton appoints Schutte as head of manganese unit ............................................ 08/06/10
                        Ryan‘s Notes Weekly ................................................................................................. 07/06/10
                        MARKE T ROUNDUP --- Nerves of steel ...................................................................... 04/06/10
                        BHP Billiton names new base metals president ............................................................ 02/06/10
                        Global manganese ore out put in Q1 up by 29pct YoY................................................... 02/06/10
                        Ryan‘s Notes Weekly ................................................................................................. 31/05/10
                        Ryan‘s Notes Weekly ................................................................................................. 24/05/10

          STEEL NEWS

                        CISA predicts rebound in Chinese domestic steel prices............................................... 22/06/10
                        Global steel output 1.6% higher in May ........................................................................ 21/06/10
                        Japan May liquid steel production hits 19-month peak .................................................. 18/06/10
                        Does China really mean business this time? ................................................................ 18/06/10
                        ArcelorMittal will inc rease output in '10 ........................................................................ 16/06/10
                        ThyssenKrupp, Vale to Open World's Most Expensive Steel Mill ................................... 16/06/10
                        Mittal close to securing land for 12 mln tpy steel plant .................................................. 15/06/10
                        Chinese steel output hits record high of 56m tonnes ..................................................... 11/06/10
                        ArcelorMittal pressured to build Egypt steel plant ......................................................... 11/06/10
                        Chinese steel majors under pressure to cut output ....................................................... 09/06/10
                        ArcelorMittal mulls Q3 furnaces shutdown ................................................................... 04/06/10
                        World steel output increases 35,7% y-on-y in April ....................................................... 21/05/10

          OHES & SCI ENCE

                                                                                        ************************

          EMM

                        Chinese manganese market firm despite slow demand ................................................ 21/06/10
                        Mn flake rises $50 on shutdowns in China ................................................................... 16/06/10
                        European manganese flake stable despite smugglers .................................................. 15/06/10
                        American Manganese Inc. to Receive Contribution Through NRC-IRAP ........................ 15/06/10
                        Chinese manganese offers firm but demand is weak .................................................... 14/06/10
                        Mn flake suffers sevent h fall in a month ....................................................................... 04/06/10

          Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             5
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
                        Chinese manganese market lacklustre on dull demand amid stainless cutbacks ............ 03/06/10
                        American Manganese moves step closer to public offering ........................................... 01/06/10
                        Chinese manganese market in downt urn on weak demand........................................... 26/05/10

          EMD

                        Delta EMD finally finds buyer for its Australian residue site ........................................... 09/06/10
                        Carbon Nanotube Foams and Nanoscale Manganese Oxide ........................................ 25/05/10




          Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                             6
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
                                   THE MANGANESE INDUSTRY


                                                 ASIA (OTHER)                                  back to index

   IMnI’s Annual Conference Was Held On 11th June At Paris
   Tex Report, 18/06/10

   185 Persons Attended, Japan Participated In This Conference With 13 Persons From 7 Companies

   The 36th Annual Conference was held by IMnI (International Manganese Institute ) during the 11t h to
   13th of June of 2010 at The Westin Hotel in Paris. 185 attendants came to t his Conference, having had
   a considerable increase of the attendants in comparison with that (118 attendants ) at the last
   Conference held at Dubai of UAE.

   The names of companies and persons attended at this Conference from Japan were Nippon Denko
   (Mitsui President and IMnI Director and others), Chuo Denki Kogyo (Somey a President and others),
   Mizushima Ferroalloy (Kasaoka President and others), Mitsui & Co., Sumitomo Corp., Tokyo Boeki and
   Japan Ferro-Alloy Association.

   The main theme for 2010 discussed at this Conference was titled as ―Where are we in the history of
   industrial development ―. Eight guest speakers delivered their speeches.

   Mr. Alaister Stalker of Assmang assumed Chairman of IMnI for 3 years but resigned from this position
   by this Conference. Mr. Peter Toth of OMH becomes Chairman of IMnI as the successor to Mr. A.
   Stalker.

   After this Conference was closed, V ale HC FeMn Plant in Dunkirk of France was visited by some of the
   attendants.

   S Korea KORES says eyeing Africa mines
   Reut ers, 17/06/ 10

   State-run Korea Resources Corp (K ORES) said on Thursday that it was looking closely at investing in
   several mines in A frica this year, expecting minerals prices pick up next year along with t he global
   economy.

   KORES President Kim S hin-jong said in a written interview with Reuters on Thursday that the company
   would use part of the proceeds from its recent $300 million bond sale to financ e the investments.

   "Although t he timing is not as good as last year, this year is still good for investment. Next year we may
   not have opportunities to acquire new mines as minerals prices are projected to recover along with the
   economy," said Kim, who has more than 30 years experience in resources development.

   KORES, which has investments in 30 resource exploration, development and production projects in 12
   countries, was interested in investing in South A frica, Mozambique, Namibia, Congo, Niger and Zambia,
   he said.

   KORES was seeking potential exploration opport unities for coal, uranium, copper and manganese, he
   added, saying: "We are interested in several mines in Africa, although we cannot yet confirm any
   acquisitions."

   CHI NESE RIVALS

   Kim said part of the proceeds from the recent bond issuance would be invested in the Ambatovy nickel
   project in Madagascar, in which KORES acquired a 22.5 percent stake in 2006.

   He added that the company had no plan to issue another dollar bond this year.



Manganese Matters n° 10 (Issued June 22, 2010)                                            index   7
        Last month, KORES sold a $300 million bond due in 2015. The issue drew $2. 6 billion in orders, with
        Asian investors taking the bulk of the debt sold.

        While KORES planned to keep its debt-to-equity ratio below 100 percent over the long term, Kim said
        the company would diversify ways to raise money by selling some assets, such as partial stakes in the
        Ambatovy project, and resource development funds, as well as spending profit from its investments.

        On the company's strategy with regard to aggressive, cash-rich Chinese competitors, Kim said: "It is
        obvious we cannot match Chinese financial capacity and investment size. But we can provide world -
        class technology in setting up information tec hnology, infrastructure and power systems, making us
        more suitable for offering package deals providing infrastructure in resource-rich countries."

        He added that KORES would continue t o bid in consortiums with local private companies to hedge
        against risks.

        South Korea, Asia's fourth-largest economy, said in April that private and public investments, including
        those by KORES, in six major minerals were estimated to reach $1.3 billion this year, up 22 percent
        from last year.

        Heavily dependent on energy and resource imports, South K orea cons umes 2.69 million tonnes of non -
        ferrous metals per year, making it the world's sixth-largest consumer, according to government data.

        Market tendency on imports of ferroalloys into Japan
        Steel Guru, 07/06/10

        TE X reported that the market tendency by item on imports of ferroalloys into Japan at May 31st 2010 is
        as follows:

        General view

        The monthly production of crude steel in China reached 55 million tonnes in April and maintained a level
        of 50 to 55 million tonnes per month since January of 2010 but the purchases of raw materials by China
        are moving to change from the middle of May. The prices of iron ore and coal, as main raw materials for
        steel production, have risen to a considerable extent and an anxiety for the possibility to pass on these
        rises of prices for raw materials to prices of steel products is currently arising. A repugnanc e for the
        increased stocks of steel products held by steel mills is now being felt in China. The market prices for
        some of Chinese ferroalloys have started to fall. Also, both prices of silicon met al and manganese metal
        produced in China have entirely weakened. The price of Chinese silicomanganese has been
        underpinned by the sharply risen price of raw material but an anxiety for the aggressive sales of Indian
        silicomanganese by means of utilizing the weakened exchange rate of Indian Rupee against US Dollar
        is coming up to the mark et. The market price of ferrosilicon once fell but has now rallied. It is marked
        how does price of Russian ferrosilicon move hereaft er.

        Ferro silicon

        Ningxia Hui Aut is one of silicon lands in China but rais ed fee of electric power from last week and,
        accordingly, an increase of cost for electric power in west north district of China is becoming an anxious
        matter. Since preferential fees of electric power applied in China were abolished, this is the second time
        in 2010, having raised electricity fee in Ningxia Hui Aut. Region. On the other hand, after the holidays
        continued for an early part of May had passed, domestic price of ferrosilicon in China once had a small
        fall but the t rading companies concerned said that, reflecting a raise of electricity fee, market price of
        Chinese ferrosilicon has turned to firm up. Chinese suppliers are now offering ferrosilicon at USD 1,430
        per tonne CIF Japan and it is diffic ult to secure actual cargoes of Chinese product at USD 1,400 CIF.
        On the ot her hand, Russian ferrosilicon was once offered at a high price of US D 1,550 per tonne CIF
        Japan but, in order to cope with the current price of Chinese ferrosilicon offered for Japan, Russian side
        has revised t heir offer to a level of USD 1,430 per tonne CIF Japan. Therefore, new price of Russian
        ferrosilicon has a possibility to be competitive again with that of Chinese product.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                            8
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Silicomanganes e

        The pric e of Indian silicomanganese was once offered on a high level but is now supposed t o have
        weak ened its attitude and this change of the aspect is due to the weakened exchange rate of Indian
        Rupee against US Dollar. The exchange rate of Indian Rupee has weakened by 6% and t he trade to
        export Indian silicomanganese at the price on US D base has multiplied the power to be more
        competitive on the overseas market. Incidentally, Indian suppliers have felt the difficulties to sell more
        silicomanganese in Europe as expected and, therefore, revised the high prices as offered for Japan on
        the end of April. The new price of Indian silicomanganese is in the range of US D 1,530 to US D 1,550
        per tonne CIF Japan, having fallen by nearly USD 100 per tonne from the high prices as mentioned
        above. A prospect of US D 1,500 CIF for Indian silicomanganese will be within hail and a basic tone on
        price of silicomanganese has changed to fall.

        Manganese metal

        Domestic price of electrolytic manganese metal in China has currently fallen to CNY 14,600 to CNY
        14,800 per tonne, having brok en a level of CNY 15,000. The price of electrolytic manganese metal in
        China had been maint ained by CNY 15,500 per ton until an early part of May but had fallen
        considerably for the next 2 weeks. This sharp fall of domestic price for Chinese electrolytic manganese
        metal has been influenced by a reduction in production of 200 s eries stainless steel in China c aused by
        a fall of nickel price. In addition, the excessive stocks of electrolytic manganese metal held by steel mills
        have deteriorat ed market price of this metal. Also, the price of C hinese electrolytic manganese metal for
        export has fallen to a low level of US D 2,800 to US D 2,850 per tonne FOB. Reflecting a weak tone of
        domestic price for electrolytic manganese metal in China, the price of this metal offered for export to
        Japan has fallen by more than USD 100 per tonne and come down to a level of USD 2,850 to USD
        2,900 per tonne CIF.

        (Sourced from TE X Report Limited)

        Korea to explore ocean for future natural resource s
        The Korea Time, 26/05/ 10

        South Korea imports most of its energy needs from outside, leaving itself extremely vulnerable to
        sudden changes in the price of oil and other raw materials.

        Coupled with the rapid depletion of natural resources, surging demand from China, India and other fast -
        growing emerging economies raises the price of crude and other commodities sharply, weighing heavily
        on the Korean economy.

        To secure a stable supply of energy resources and achieve a sustainable growth, the nation should turn
        its eye to the sea and make larger investments to explore a range of minerals on the sea bottom, Korea
        Ocean Research and Development Institute (KORDI) President Kang Jung -keuk stressed.

        ``To cut our reliance on oil and other conventional fossil fuels produced on land, we should proactively
        explore manganese nodules and other marine natural resources. We secured 75,000 square kilomet ers
        of open sea in t he Pacific Ocean under which some 510 million tons of manganese nodules are
        estimated to be buried. Additionally, we secured the right to explore 20,000 square kilometers of the
        open water near the Kingdom of Tonga in the South Pacific where around 300,000 tons of gold are
        likely buried, '' Kang said.

        To more effectively mine manganese nodules and other minerals at the sea bottom, the institute has
        developed an unmanned robot, named ``MineRo.''

        ``We successfully tested it in the East Sea last year. It operated 100 meters below the sea level. In the
        near future, we will mak e it operational 5,000 meters below the surface, '' he said.

        The institute is undertaking several economic feasibility studies on the construction of electric power
        plants using tidal currents in the West Sea, while working on the state-of-the-art technologies to
        produce bio-ethanol from marine algae.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                            9
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        ``Generating electricity from tidal currents and extracting fuel from marine plants are environmentally
        friendly and renewable energies, which will help Korea reduce its imports of conventional fossil fuels,
        boost economic activities and create jobs. We will also make effort to foster a marine biotechnol ogy
        sector by studying microorganisms that inhabit the most extreme living environments under the sea. By
        examining them, we could obtain materials for new medicines and create a range of benefits for
        humans,'' Kang said.

        Malaysia: IFASB to Set Up Country’ s First Silico Manganese Processing Plant in Perak
        Syndigate Info, 25/05/10

        Ipoh Ferro Alloys Sdn Bhd (IFASB), a subsidiary of IRSB Corporation (M) S dn Bhd, will be setting up
        the country's first Silico Manganese, Ferro Manganese and Ferro Silicon proces sing plant on an 80-
        hectare site at the Seri Iskandar Industrial zone near here.

        IRSB 's Chief Executive Offic er, G.K. Hari, said IFASB would be investing RM200 million on the project
        which is expected to be developed under a five -phase period.

        "For a start, we will develop an area of four hectares with an investment of RM30 million within six
        months of the completion of the documentation process.

        "We have chosen Seri Iskandar due to its proximity to Lumut Port which will make it easier for the
        transportation of coal from Indonesia," he told reporters here Monday.

        Hari said once the first phase of the plant is completed, it would be able to cater to 25 per cent of the
        local users' needs of the alloys. The users currently get their supply from China, India and African
        countries.

        He said the plant would also see a transfer of technology from Japan and India.

        "We would bring experts from Japan and India to monitor the products of IFASB to ensure that they are
        of high quality," he said.

        The plant would open up some 350 job opportunities for locals while providing businesses for building
        contractors and transportation companies, Hari said.

        Silico Manganes e, Ferro Manganese and Ferro Silicon are alloys used to stabilise products produced
        by steel producers.

        Among t he local users of the alloys include P erwaja Steel, Malayawata Steel, Mega Steel, AM Steel,
        Southern Steel, Ann Joo Steel and Mitsui Corporation.


                                                                                            CHINA                                                                       back to index

        BHP Billiton holds manganese ore prices in July, August
        Metal-Pages, 18/06/10

        BHP Billiton has rolled over its June manganese ore prices through July and August against plentiful
        stocks and weaker manganese alloys prices, according to industry sources this week.

        Offers with minimum 43% metal content are about $8.35 per mtu (metric tonne unit) basis CIF China for
        July and August shipment, while lump with minimum 43% metal content is around $8.70/mtu, sources
        said.

        Metal lumps with a minimum 48% metal content have been unchanged at $9.40/mtu.

        ―Alloys producers have cut their buying interest in recent weeks in line with a drop in their product
        prices, and there is little activity in manganese ore activity in Chinese ports,‖ one dealer said.

  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          10
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Dealers said B HP had won a sharp increase in m anganese ore prices in June, mostly due to a stronger
        iron ore market.

        However, with manganese ore stocks at above a million tonnes in Chinese ports such as Tianjin, an
        increase in prices through the third quarter looked unjustified, dealers said.

        With some 2 million tonnes of manganese ore reckoned to be stockpiled in China, representing about 5
        months of domestic demand on average, as well as short term weakness seen in manganese alloys
        through the seasonal slowdown and weaker steel demand, the market is expecting more losses.

        Chinese imports of manganese ores hit a historical peak of almost 4 million tonnes in the first four
        months of this year, more than double the 1.73 million tonnes imported in the same period of last year,
        according to the latest Chinese Customs data.

        IMnI conference: Chinese steel boom unstoppable
        Metal-Pages, 14/06/10

        China's steel boom is set to continue for another two to three decades,
        Wang Feng, executive director of China National Minerals Co told the
        International Manganese Institute 36th annual conference in Paris at the
        week end.
        With a push for urbanisation China will need 300 million to 400 million
        tonnes of steel more than it can produce now, and its annual crude steel
        output will have to rise to about 1 billion tonnes. "So for the next 20 to 30
        years steel will still be a boom industry in China," Wang said.

        The key to cons umption growt h lies in the construction and housing
        sector, and mortgages may be the way to drive the sector and the whole
        economy in the future, he suggested. At present, the Chinese government is trying to control the growth
        in the construction sector, and t he third quarter would see a slowdown in steel production, Wang not ed,
        however the overall trend is still up both in the medium and long term. I n May alone, China produc ed 56
        million tonnes of steel, a production rate which sets it on course to exceed the 2009 annual output of
        567.8 million tonnes.

        "The third quarter in China may be slower as the government is taking measures to control growth, b ut
        in any case this year as a whole China will definitely produce more than in 2009 and we will produce
        more than 600 million tonnes of steel," he said.

        "It is estimated that steel consumption in China will be 50 million tonnes higher than in 2009 and t ha t
        export will reach 40 million tonnes, and that crude steel production will be between 630 million and 650
        million tonnes this year."

        Chin has 1.6 billion people of whom some 0.4 -0.5 billion live in the city, with many more living in rural
        areas. "The government aims to reduc e rural population from 1 billion to 0.4 billion in the next 30 years.
        In terms of steel production that means that in the long term it needs to be near 0. 9 billion to 1 billion
        tonnes," Wang told delegates.

        Chinese steel production began its growth aft er the 1940s, following the revolution, under the cent rally
        planned economy run by the communist government. From about 0.6 million at the end of the 1940s to
        early 1950s, China's steel production reac hed around 30 million in the late 1970s - 23.9 million tonnes
        in 1975 and 31.78 million tonnes in 1978. But the real growth spurt followed the move to market
        economy under the government of Deng Xiaoping, as china became a socialist government with
        elements of capitalism. "The main part of the development is coming from the mark et economy," Wang
        said.

        From 36.2 million tonnes in 1980 Chinese steel output grew to exceed 100 million tonnes in the 1990s,
        with the country production 124.26 million tonnes of steel in 1999. The 2000s brought anot h er explosion
        in capacity. Following China's ent ry in to the WTO the country started making more steel than ever


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          11
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        before, with production soaring from 126 million in 2000 to 352.39 million in 2005 to 567. 8 million in
        2009.

        The entry into the WTO was the tu rning point. "If the whole world market opened to China then China
        could occupy the whole of the world market," Wang commented.

        The Chines e steel industry needs future development but will meet a lot of challenges, especially in
        terms of raw material supply. Technologically it is also still at a stage of producing mainly low grades of
        steel, which have driven its growt h. "The technology of the steel industry is easy to copy," Wang pointed
        out," and most steelmakers make low grade products such as wire rod, steel sheet and rebar."

        China's main competitive advantage has been its cheap labour, with workers accustomed to enduring
        long hours and earning enough to cover only the most basic needs, he added.

        Another cheap advantage has been China's lack of environmental regulation. The government is now
        tightening this lax environmental regime and trying to get the industry investing in green technology.
        However China does not as yet have green technology, Wang said, suggesting that the environmental
        drive will result in great er concent ration in the industry, with consolidation under larger producers, as
        smaller mills have much poorer technology insufficient to make them a green industry.

        However the competitive advantage of cheap labour is set to remain. Despite current emerging labour
        disputes, Wang suggested that the need for improved labour condition and higher wages would not be
        a problem for at least another ten, twenty years. "If the workers get the industry to pay more, the labour
        efficiency will also get much higher," he said, adding that labour efficiency at Chinese plants is already
        much higher than in the developed world.

        Chinese ferro-alloy output up 6.5% in May
        Metal Bulletin, 11/06/10

        China's ferro-alloy output rose in May for the third month in a r ow to 2.26 million tonnes, but is expected
        to fall due to lower prices and demand, said market sources.

        "Output remained high in May, but I think it may keep stable or decrease somewhat in the next two or
        three months," said a manganese alloys producer in Guangxi province, citing firm manganese ore
        prices but falling alloys prices, and buying from steel mills fell.

        China's ferro-alloys output rose 6.5% from April to 2.26 million tonnes in May, up 22% year-on-year,
        according to the national statistics bureau.

        The weak market situation has been exacerbated by higher costs after the government lifted power
        tariffs in June.

        Most ferro-molybdenum smelters have suspended production, with as many as 60-70% closed in the
        key production base of Huludao in Liaonin g province, aft er prices fell 12% in a month (MB Jun 10).

        "If the market continues to be weak, then I am afraid ferro -chrome produc ers may als o consider closing
        smelters," said a ferro-chrome producer in Sichuan.

        "For the moment, most ferro-chrome producers are still at full capacity."

        In the first five mont hs of this year, China produced 9.92 million tonnes of ferro-alloys, up 31% year-on-
        year, according to the bureau.

        Chinese ferroalloys weekly roundup - Increase in power rates drives FeSi offers up, others
        unaffected
        Metal-Pages, 03/06/10

        The increase in electricity tariffs on energy sensitive sectors appear to have only impacted on ferro -
        silicon, with electricity estimated to account for over 80% of its production cost. Other markets have had


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          12
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        another week of falling or unmoved prices with weak demand from the precarious steel sector cited as
        the main culprit.

        China‘s ferro-alloys exporters say they continue to face serious difficulties as a result of their
        dependence on overseas mark ets, according to industry speakers at a recent ferro -alloys conference.

        The global output of crude steel has decreased this year and high production c osts keep prices of
        China‘s exports uncompetitive in the international market.

        Increased chrome and manganese ore prices have to some extent supported export prices, China‘s
        exports are also being hampered by uncompetitive prices. Beijing‘s restrictive policies, such as high
        export duties are als o a factor.

        In regard to the market outlook for 2010, the recovery of the wo rld economy is expected in a way to help
        revive China‘s ferro-alloy exports, but high unemployment and the European debt crisis is still adding
        uncertainty to the world economy.

        FERRO-SILICON

        Chinese ferro-silicon producers have been increasing their offer prices this week as electricity tariffs in
        main producing regions such as Ningxia and Gansu are reported to have been raised as of June 1.
        However, steel mills are hesitant to buy in due to unc ertain market outlook for the steel sector itself.

        ―There have been limited transacted deals so far this week as although production c osts are going
        higher, demand from downstream sectors is far from satisfactory,‖ said a producer source.

        Demand for high purity ferro-silicon is expected to grow, while China‘s production capacity for the
        material will be expanded steadily in the next few years, according to Jing Meili of China‘s Ningxia
        Yinglite Binhe Metallurgical Co.

        ―As overseas and domestic steel mills are shifting more of their capacity to production of steel using
        high purity ferro-silicon, the demand is expected to increase further. To meet the growing demand,
        China‘s annual capacity of high purity ferro -silicon will expand to over 200,000 in the next two or three
        years,‖ Jing told delegates at the China ferro-alloys International Conference in Shanghai.

        ―However, the increase in capacity will certainly bring about keener competition,‖ she added.

        MANGANES E METAL AND ALLOYS

        Chinese electrolytic manganese market has been quiet this week with prices largely u nchanged to the
        previous level.

        Demand is continuing to weaken amid widespread bearish sentiments among market players. With
        stainless mills increasing production cutbacks and thus stopped buying manganese, about 40% of
        capacity has been shut, according to industry estimates.

        There is also thin demand from overseas consumers as falling domestic prices encourage buyers to
        take a wait and see attitude.

        However, a Hunan based producer reported that the government will launch an ins pection on
        producers‘ envi ronmental facilities in June and all unqualified players will face shutdown.

        European spot manganese flake prices have dropped again in the past week on increased supplies,
        notably imported material, amid quiet market demand.

        ―The European market has been quiet for several weeks now and there have been more, cheaper
        shipments from Asia that has been dragging on European prices more recently,‖ a dealer said.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          13
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        However, some European manganese dealers say Chinese flake is being shipped via Vietnam – to
        avoid the Chinese 20% export duty – and then stored in warehous es, such as Rotterdam, after
        European Customs clearance.

        Some Chines e exporters say virtually no mat erial is being shipped from China as the 20% export duty is
        too expensive, while shipments from Vietnam are being offered at $2,700/tonne duty delivered paid,
        and even cheaper, to European dealers.

        The Chinese manganes e alloys market has seen another lackluster week amid quiet trading activity.
        Spot manganese ore prices remain under downward pressure due to inactive buying from ferroalloys
        makers and large stockpiles at ports.

        BHP Billiton‘s new offer prices should be disappointing Chinese ore consumers again as its offer prices
        for shipments in July and August will be unchanged to the previous level.

        BHP holds Mn offers to China steady for July, August
        Metal Bulletin, 03/06/10

        BHP Billiton has held its manganese ore prices for July and August at the same level as June, as the
        falling downstream manganese alloys market and high ore stocks weigh on market sentiment.

        Offers of siliceous chip with minimum 43% metal content are at $8.35 per mtu cif China for July and
        August shipment, while siliceous lump with minimum 43% metal content is at $8.70 per mtu, according
        to market participants in China.
        Metallurgical lump with minimum 48% metal content is also unchanged at $9. 40 per mtu.

        ―In June, BHP had a substantial increase in manganese ore prices offer that was closely related to iron
        ore. But now there is no motivation for manganese ore prices to continue rising because of the current
        poor performance of downstream alloys market, ‖ said a major trader in Beijing.

        BHP lifted its manganes e ore prices last month for June shipment by as much as 11%, despit e signs
        the market was weakening.

        ―Ore sales in recent weeks have been very weak in the port, as most alloys producers are unwilling to
        purchase on falling prices of their products,‖ said a trader in Lianyungang, Jiangsu province.

        A trader in the Tianjin port, where reported manganese ore inventory is above 1 million tonnes, sold
        manganese ore at a loss in order to improve their cashflow to buy other products, he told MB.

        Manganese ore stocks in China are more than 2 million tonnes, traders said, adding that Qinzhou port
        in Guangxi province has around 700,000 tonnes of manganese ore.

        ―Manganese ore inventory has been rising over the past year, and now it is difficult to say how much is
        the normal level. The current 2 million tonnes of stock is about at least four to six months of demand for
        domestic producers, ‖ said a trader in Zhanjiang city, Guangxi province.

        Ferro-manganese and silico-manganese prices are likely to continue to fall back in the near term on
        weak demand from steel sector, even after the government cancelled the preferential power tariff for
        high energy consumption enterprises and closed more small manganese smelters, market participants
        said.

        ―Power fees increased 3-5 cents from this week, which means that manganese alloys production costs
        rose by 135-225 yuan ($20-33) per tonne, while our prices fell further on lower steel mills purchase
        prices, ‖ said a producer in Guangxi.

        A producer in Sichuan echoed his comments, saying that they still had difficulty in concluding deals
        even after they cut offers by 100 yuan to 8300 yuan p er tonne.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          14
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        High-carbon ferro-manganese prices dropped 200 yuan from last week to 8,000 -8,300 yuan per tonne,
        while silico-manganese was at 7,900-8,300 yuan, down 100-200 yuan from a week ago.

        ―According to current manganese ore costs, alloys producers are doing business at a loss, and hence I
        guess many small smelters will choose to shut down or cut production to reduce losses, ‖ the Sichuan
        producer added.

        Chinese ferro-alloys exports continue to struggle
        Metal-Pages, 31/05/10

        China‘s ferro-alloys exporters say they continue to face serious difficulties from their dependence on
        overseas markets, according to Xu Xu, chairman of the China Chamber of Chemic als and Minerals
        Importers and Exporters (CCCMC) trade body.

        ―The global output of crude steel has decreased this year and high production costs keep prices of
        China‘s exports uncompetitive in the international market,‖ Xu told delegates at the China Ferro -alloys
        International Conference in Shanghai.

        Increased chrome and manganese ore prices have to some extent supported export prices, China‘s
        exports are also being hampered by uncompetitive prices. Beijing‘s restrictive policies, such as high
        export duties are als o a factor, Xu said.

        ―In regard to the market outlook for 2010, the recovery of the world economy is expected in a way to
        help revive China‘s ferro-alloy exports, but high unemployment and the European debt crisis is still
        adding uncertainty to the world economy,‖ Xu said.

        China is the world largest ferro-alloys producer and consumer as well as one of the major ex port ers.

        Most of China's ferro-alloy capacity cuts to come from Mn, says CFIA
        Metal Bulletin, 31/05/10

        China's plans to close 4% of its ferro -alloy capacity before July is hitting manganese alloys the hardest,
        said a senior official at China Ferroalloys Industry Assn (CFIA ).

        "More than half of the capacity to be phased out are of manganese alloys," said Zhang Zengchan,
        assistant to the president at CFIA.

        The ministry of industry and information technology last week confirmed that China was shutting down
        all ferro-alloy furnac es operating at below 6,300kVa.

        "In order to ensure the completion of 11th Five Year Plan's emission reduction targets and res pond to
        global climate change, we will phase out 1.44 million tpy of backward ferro-alloys capacity before the
        third quarter," said Yang Yongxin, an official at the ministry.

        All would be closed this time, Yang added.

        "Hunan, Guizhou and Sichuan provinc es will take the biggest cuts," Yang said, noting that China's
        present ferro-alloy capacity is 34 million tpy.

        These provinces are the major producers of manganese alloys in China, said CFIA's Zhang.

        Still, Zhang said, there was a need to tackle China's ferro-alloy overcapacity, which has led to an
        oversupplied market in recent years as well as price declines.

        In 2009, China phased out 1.62 million tpy of outdated ferro-alloys capacity.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          15
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Minmetals Hunan shuts two SiMn smelters
        Metal Bulletin, 24/05/10

        Minmetals (Hunan) Ferroalloys, a major silico-manganese producer in China, has shut down two
        smelters this month for an upgrade, said a company source.

        The smelters, of 12, 500kVA and a 30,000kVA, will be upgraded to be more environmentally friendly and
        less pollutive, said the source.

        "This transformation will be complet ed by the end of June," said the source, adding that there another
        smelter will be closed after these t wo have completed their upgrades.

        The shutdown will have limited impact on the market as silico-manganese prices are falling due to weak
        demand now, said traders.

        Minmetals (Hunan) Ferroalloys has 210,000 tpy of silico-manganese capacity and is among the five
        largest in China. It has complet ed an environmental upgrade on its four other smelters.


                                                                                             INDIA                                                                      back to index

        India maintains status quo on ferro -alloy import duty
        Metal-Pages, 21/06/10

        The Indian government is yet to react to demands from the country's ferro-alloys industry for a hike in
        import duty on ferro-alloys. The mines director, RN Dash, has said that there is no such proposal at
        present being discussed at union government level..

        The Indian Ferro Alloys Producers Association (IFAPA ) has been demanding that the import duty on
        ferro-alloys be raised to 7.5% from the present 5% to encourage domestic producers, prot ecting them
        from foreign competition in India's domestic market. India's ferro-alloys industry, which has built about
        3.6 million tpy of capacity, is now producing only 2.4 million tpy, utilising less than 70% of its annual
        capacity.

        Dash, in his address at the national seminar on ferro-alloys industries said that his ministry has initiated
        the process of delisting silico-manganese from the restricted category for the benefit of the ferro -alloys
        industries in the country. He said the government has imposed an export duty on chrome ore to
        encourage value addition in the country.

        The Union mines director told the seminar that the standalone ferro-alloys manufacturers in the country
        would either merge with larger steel plants or may go for forward int egration.

        Indian Market Report - Steel mills eye more capacity, but raw materials markets weaken
        Metal-Pages, 15/06/10

        Indian market report ArcelorMittal, Posco and other five companies may spend a combined INR1.42
        trillion ($30.4 billion) to build plants in southern India, according to Indian media reports.

        ArcelorMittal plans to invest INR300 billion ($6.4 billion) in the state of Karnataka, Lakshmi Mittal,
        Chairman, ArcelorMittal was quoted as saying. Posco plans to invest INR 320 billion ($6.85 billion) for a
        6 million tpy plant, the report stated.

        Karnataka in southern India is seeking investments to exploit its iron-ore resources. Compared with
        Orissa and Jharkhand in the east, Karnataka may face fewer problems convincing its people to give up
        land because of the high literacy level, but land valuation could be a hurdle, the report suggested.

        JSW Steel may invest INR151.3 bilion ($3.24 billion) and Bhushan Steel Ltd. INR 279 billion ($5.97
        billion) in the state. Essar Steel plans to invest INR220 billion ($4.71 billion) to build a 6million tpy plant
        at Bagalkot, Chairman Shashi Ruia said.

  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          16
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Globally, the steel companies are seeking access to mines to build plants as raw mat erial costs soared
        with the economic recovery.

        Karnataka has reserves of 11% of India‘s hematite iron ore, according to the mines ministry. The ore is
        mainly spread across the districts of Bellary, where ArcelorMittal plans to site its new facilities.

        MANGA NESE ORE

        Indian manganese ore market is a little weak at present and traders are beginning to worry. The
        international price is down and if the market is not supported by domestic demand, than it has no hope
        of maintaining its momentum.

        Currently the prices have gone down slightly but there is still hope, however if markets turn ba d then
        profit margins will go down and there will be cause for worry, says a Mumbai based trader. The
        international manganese ore price is mainly stable, with leading miner BHP still maint aining its previous
        offers, so the price could not go down sharply in the near term, he predicts however.

        Currently Indian manganese ore is being sold at INR 20,000 -22,500/tonne ($428-482/tonne ex works)
        by private producers, while state miner MOIL is offering manganese ore at INR 19,126/ tonne
        ($409/tonne).

        Indian mineral production up 14.41%
        Metal-Pages, 04/06/10

        The mineral production from the mining and quarrying sector in March 2010 was higher by 14.41%
        compared to that of the preceding month.

        However, the mineral sector has shown a positive growth of 9.75% during the current financial year i.e.
        April- March 2009-10 as compared to that of the previous year.

        The mineral production alone in March 2010 was higher by 10.96% as compared to that of the
        corresponding month of the previous year.

        The total value of mineral production (excluding atomic and minor minerals) in t he country during March
        2010 was INR113.16 billion ($2.43 billion). The contribution of coal was the highest at INR47. 61 billion
        ($1.02 billion)representing 42%.

        Next in the order of importance were: iron ore INR22.61 billion ($485 million), petroleum (crude)
        INR16.48 billion, natural gas (utilized) INR14.74 billion, lignite INR2.73 billion and limestone INR2.66
        billion. These six minerals together contributed about 94% of the total value of mineral production in
        March 2010.

        Production level of important minerals in March 2010 were: coal 60.9 million tonnes, iron ore 20.5
        million tonnes, lignite 3.3 million tonnes, natural gas (utilized) 4715 million cu.m., petroleum (crude) 3
        million tonnes, bauxite 1.339 million tonnes, chromite 289,000 tonnes, copper conc. 12,000 tonnes, gold
        220 kg, lead conc. 13,000 tonnes, manganes e ore 232,000 tonnes, zinc conc. 111,000 tonnes, apatite
        and phosphorit e 121,000 tonnes, dolomite 382, 000 tonnes, limestone 21 million t onnes, magnesite
        28,000 tonnes and diamond 3, 363 carats.

        In March 2010, the output of diamonds increased by 58.86%, apatite and phosphorite 28.69%, coal
        20.88%, magnesite 19.07% , zinc conc. 17.87% , natural gas (utilised) 14. 03% , petroleum (crude)
        11.16% , limestone 9. 14%, gold 8.37%, lignite 6.9%, bauxite 6.53%, iron ore 6.35% , lead conc. 3.12%,
        chromite 2.19%, copper conc. 0.42%. However, the production of manganese ore decreased by 0.83%
        and dolomite 1. 53%.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          17
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Rohit Ferro-Tech starts Mn alloy production at Haldia
        Metal Bulletin, 01/06/10

        India‘s Rohit Ferro-Tech has started production at the first furnace of its new manganese alloys plant in
        Haldia, West Bengal, the company said in a regulatory filing.

        The company will open a further five furnaces one by one and at intervals of two to three months, it
        said. When operating at full capacity, the plant will produce 100,000 tpy of ferro -manganese and silico-
        manganese.

        Rohit Ferro-Tech has a current production capacity of 180,000 t py of ferro-alloys, including high-carbon
        ferro-chrome, from its plants in Bishnupur, West Bengal, and the Kalinganagar Industrial Complex in
        Orissa.

        In addition to new production from Haldia, the company is planning to add another 50,000 tpy of
        capacity in Orissa, slated for completion next year.

        ―With the current capacity of 180,000 tpy of ferro-alloys production, and the projected capacity of
        280,000 tpy by 2010, and 330, 000 tpy by 2011, [Rohit Ferro-Tech] is focusing [on] its competitive
        advantage and try[ing] to emerge as one of the largest ferro-alloy producers in India, ‖ the company said
        on its website.

        The Haldia project will be a 100% export-oriented unit.

        Indian manganese market stable
        Metal-Pages, 31/05/10

        Indian manganese prices are stable with little market activity, traders say.

        Silico-manganese 60/14 material is fetching INR 55,000/ tonne with high-carbon ferro-manganese 70%
        material at INR 62, 000/tonne.

        A ferro-manganese trader who imports material from the middle -east regions reportedly received an
        offer for $1,500/tonne from Dubai-based vendors, CNF basis. One domestic Indian supplier quoted
        $1,520/ tonne for the grade ore FOB basis. The trader is waiting for lower offers in the region of
        $1,480/tonne.

        The silico-manganes e market may rebound in next few weeks due to rising production costs, in the view
        of one Indian manganese alloy trader. Higher electricity tariffs and the higher cost of imported silicon
        metal push Indian market prices up in the trader said.

        However, other suppliers and traders say there are currently few deals being made and with markets
        very slow, a price rebound is unlikely in the short term.

        Indian manganese mark et stable
        Metal-Pages, 31/05/10

        Indian manganese prices are stable with little market activity, traders say.

        Silico-manganese 60/14 material is fetching INR 55,000/ tonne with high-carbon ferro-manganese 70%
        material at INR 62, 000/tonne.

        A ferro-manganese trader who imports material from the middle -east regions reportedly received an
        offer for $1,500/tonne from Dubai-based vendors, CNF basis. One domestic Indian supplier quoted
        $1,520/ tonne for the grade ore FOB basis. The trader is waiting for lower offers in the region of
        $1,480/tonne.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          18
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The silico-manganes e market may rebound in next few weeks due to rising production costs, in the view
        of one Indian manganese alloy trader. Higher electricity tariffs and the higher cost of imported silicon
        metal push Indian market prices up in the trader said.

        However, other suppliers and traders say there are currently few deals bei ng made and with markets
        very slow, a price rebound is unlikely in the short term.

        Rohit Ferro-Tech starts production at new 100% EOU unit at Haldia
        Equity Bulls, 31/05/ 10

        Rohit Ferro-Tech Ltd has announc ed that the Commercial Production of Company 's new 100% E OU at
        Haldia has started the production from the first furnace on May 31, 2010. Production from ot her five
        furnaces is expected to start one by one at an interval of 2-3 months.

        The Company will make manganese alloys from this unit, which is mainly targeted for exports.


                                                                                         OCEANIA                                                                        back to index

        Spitfire Resource s Picks Up Tenements Near Woodie Woodie Manganese Mine
        Proactive Investors, 22/06/10

        Spitfire Resources (AS X: SPI) has won a ballot to secure new tenements surrendered by Consolidated
        Minerals that are are located down -strike to the south of its world-class 1Mtpa Woodie Woodie
        Manganese mine in the East Pilbara region.

        The two new tenements, E46/902 (107km2) and E46/893 (87km2) are adjacent to existing t enure at
        South Woodie Woodie.

        Spitfire‘s total East Pilbara ground holding at South Woodie Woodie now stand at 1,749 sq km. The new
        and recently announced t enement applications are all 100% owned. S pitfire‘s original tenement holding
        of 430.1 sq km at South Woodie Woodie is 80% owned.

        ―This is anot her strategic addition to our East Pilbara tenement portfolio following our success in April in
        securing a highly pros pective 111 sq km tenement located immediat ely north of the Nicholas Downs
        Manganese Mine,‖ executive chairman James Hamilton said.

        ―South Woodie Woodie is our core area of focus and activity and we are very pleased that we have
        been so successful in expanding our tenure in a highly competitive environment.‖

        Regional mapping is planned to commence upon granting to generate an initial round of targets on the
        new tenements.

        Groote Re source s Aiming To Become "Major" Manganese Force
        Proactive Investor, 15/06/10

        Groote Resources is a newly minted manganese explorer / developer listed on the A ustrali an Stock
        Exchange under the code GOT. The company was previously known as Western Uranium and was
        floated to explore uranium leases in Western Australia that were spun off by Prairie Downs (AS X: P DZ).

        That endeavor garnered relatively little traction and the stock traded around 10 cents. In November of
        last year the company purchased Reflective Minerals which held applications for 5 mineral exploration
        leases and one authorization covering 1,723 square kilometers which includes the inferred down dip
        and strike extensions of the richest manganese mine in the world loc ated on Groote Eylandt and
        operated by a joint venture between BHP Billiton (AS X:BHP, LON:BLT) and Anglo American (LON:AAL)
        and known as Gemco.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          19
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        In 2009 this mine recorded earnings before interest taxes and depreciation of ~A$1. 1 Billion from the
        mining of 2.3 million tonnes of high grade manganese and is known as one of the most profitable mines
        in Australia and the lowest cost producer of manganese in the world.

        This has led to a very substantial re-rating of GOT with its diluted market cap at one stage over A$100
        million but now with the very tantalizing possibility of becoming a very major player in the manganese
        market. Based on its current work program GOT estimates the potential for a resource of 50 million
        tonnes of manganes e with annualized production of 2 to 3 million tonnes of high grade ore putting it into
        the same league as Gemco if it can fully execute its game plan.

        The Geology of Groote Eylandt and the Inferred Extensions of Man ganese Mineralization

        The Gemco leases covered all of Groote Eylandt but only up to the shoreline and contain a resource
        currently measured at 160 million tonnes at a grade of 45. 5% manganese located along the western
        and southern flank of the island. Some geological studies indicate that the total resource may be
        several times bigger.

        Geological studies carried out by the Directors of Reflective Minerals showed a very strong possibility
        that the manganese deposit on the Gemco leases lay like a very large sedimentary ―blanket‖ that varied
        in dept h but averaged 3 meters and it gently dipped into the very shallow wat ers that they pegged along
        shoreline of the island.

        The waters here are only about 7 met ers in depth and the ground cover over the deposit is only about 3
        meters deep as can be seen in photographs of the walls of the Gemco open pit. All of the cover is very
        soft sandy material which mak es it very low cost to extract. Further physical studies on Winchelsea
        Island which is directly north of the main deposit clearly show an area measured as 17 square
        kilometers which appears to be another sedimentary blanket. Photos on the GOT website clearly show
        a repetition of the blanket like layers found in the Gemco pit repeating along the shoreline outcrops at a
        number of locations where manganese is found.

        GOT holds exploration rights for six tenements covering 1, 723 km2 of shallow marine terrain and two
        islands near Groot e Eylandt in the Northern Territory of A ustralia. These tenements are located
        immediat ely adjacent to and cont ain the interpreted extensions of the world -class manganese deposits
        at Groot e Eylandt currently being mined by GEMCO.

        GOT has now also pegged new authorization applications and offshore mineral exploration licenses
        covering 15,439 square kilometers running south and west back to the Northern Territory coastline.
        These applications extend close to onshore manganese finds at Rosie Creek and Battern Creek.

        Following GOT‘s applications for the offshore tenements on the west coast of Groote Eylandt, GEMCO
        immediat ely applied for all of the remaining offshore areas.

        Management Skills

        When GOT bought Reflective Minerals they picked up Alex Hewlett as a Director. Alex was the Senior
        Geologist who put together the research and Groot e Eylandt leases backed by financier Simon Noon
        who also joined the Board. Simon Brown another Senior Geologist is added to the management team
        who will oversee the planned exploration program, drilling and resource modeling. Simon has twenty
        years of international experience of which a substantial part has been spent working in the Northern
        Territ ory.

        Peter Waterman has also been added and is an Associate Professor and Environmental Advisor who
        works extensively in the Northern Territory.

        Additional technical support will be provided by Barrie Bolton who is a Geological Advisor and has
        work ed on manganese properties worldwide for thirty years.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          20
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Project Development and Planned Exploration Program

        All of the various applications for exploration areas are currently pending grants and regulat ory
        clearances. The company has been granted approval to begin discussions with the local aboriginal land
        council for both Connexion and Winchelsea Islands. Assuming that all of these issues are resolved then
        the company will be able to commence the land based phase of its exploration program.

        The on shore part of the program will consist of geological mapping, sampling by way pitting and
        trenching and collection of surface rocks, ground gravity surveys, airborne electromagnet ic surveys
        followed by drilling which should be very economic due to the very shallow nature of the target area.

        The off shore part of the program will include a lot more aerial mapping and targeting with drilling to
        shallow depths complet ed from barges. At the completion of these t wo programs and assuming positive
        exploration res ults a feasibility study will be undertak en. This will be followed by funding and mine
        development. There is sufficient local infrastructure to support both a new mine and short t ransport
        routes by ship into growing Asian markets.

        One of the keys to GOT is its surfac e mineable manganese deposit target containing a minimum of 50
        Mt of recoverable MnO2, with potential high grade ranging bet ween 35 -50% Mn, low concentrations of
        Si, Al, Fe, S, P, heavy metals and contained H2O, and easily separable Mn and gangue.

        Cash

        GOT had $2. 6 million in its kitty at March quart er end, which is sufficient to carry out a significant
        exploration program. In addition, GOT has issued 10. 9 million o ptions with an ex piry / strike of $0. 20 on
        30 June 2010. Conversion of t hese, which seems likely with current share price well above strike price,
        would bring in an extra $2.1 million in cash.

        Manganese Market

        Manganese is traded in metric tonne units or MTU‘s weighing 10 kilos / 20.5 lbs which are priced by
        grade and currently fall into a range bet ween $6-9 per MTU.

        The price for medium to high grade manganese oxide ores is expected to remain favourable to mining
        companies, largely owing to steadily increasing per c apita cons umption of steel in the developing world.
        The market for stainless steels is expected to increase faster than steel in general. Further, the grade
        profile of ores available is shifting downwards, requiring more blending and thus higher premiums for
        higher grade ores.

        The typical prices of manganese ores offered for China recently are lump ore with Mn 44% at
        US$7.85/t, chips with Mn 43% at US$7.7/t and high grade met allurgical lump ore at US$8.45/t. The
        contractual condition to import manganese ore has been traditionally bas ed on FOB price, although
        major manganese companies have recently proposed to change it to CIF price.

        Manganese is the fourt h most used metal by weight after iron, aluminium and copper. There is no
        satisfactory substitute in its application as a hardening alloy element and de-oxidant in steel and the
        manganese market is highly leveraged to increases in demand for steel. Approximately 94% of
        manganese is used as a ferroalloy in steelmaking, 6% is used to produce dry cell batteries and
        aluminium cans.

        The demand for manganese is driven by the production of steel which is driven by world population
        growth where supply of high grade manganese ore is falling behind demand. Last year the global
        market for manganes e traded at 54 million tonnes with 90% of this consumed by the steel industry and
        the remaining 10% went mostly into dry cell batteries and aluminum cans. BHP Billiton is a major
        supplier into this market and it sees a very bright future for both steel and manganese.

        If GOT is able to exec ute its business plan and eventually meet production targets of 2-3 million tonnes
        per year it will become a significant world player in the manganese market with annual revenues that
        reach int o the low multi billions.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          21
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        With the pullback in prices of ex plorers, GOT has not been immune from the malaise, its share price
        falling from a high of $1.04 to the current $0.63 and mark et capitalisation of circa <$60 million based on
        current issued capital, diluted for June 30 options. Market volatility and provides an opportunity for
        liquid investors to accumulate stock.

        Based on the industry average EV/Resource of $43/t the potential valuation for GOT, (assuming the
        company‘s target of 50Mt is proven up), is approximately $2.1 billion: (Patersons ). This compares
        favourably with GOT‘s current market capitalisation.

        As this process plays out the GOT stock price will certainly reflect this progress.


                                                                                          EUROPE                                                                        back to index

        European silico-manganese market up almost 5%
        Metal-Pages, 17/06/10

        The European silico-manganese market has increas ed €50 a tonne, or almost 5%, in the past week on
        supply worries amid tight availability, dealers told Metal-Pages on Thursday.

        The market has been spooked on delayed shipments from S outh A frica, where a rec ent labour strike at
        the country‘s domestic rail network provider, Transport, has affected bulk alloy shipments that are
        expected to be delay ed until July.

        Silico-manganese 65/17 grade spot prices are at €1, 200 -1,250/tonne basis delivered.

        ―There is a backlog of material waiting to be processed and shipped from South A frican ports and so
        material due in E urope may be up to six weeks behind schedule, ‖ one dealer said.

        ―Some consumers and traders are looking to cover delayed deliveries from the spot market and
        suppliers have upped their offer prices.‖

        Dealers said there have been unusually strong bids for up to as much as 1,000 tonnes replacement
        material to be delivered promptly, despite heavy industry set to shut down for most of July in the
        seasonal slowdown, when steel producers typically conduct repairs and maintenance as plant work ers
        take vacation.

        However, European ferro-alloys producers have been disciplined in their production volumes since
        drastic cuts last year, with few stocks to spare for spot sales through 2010 so far.

        Moreover, currency moves have also been a factor.

        The euro has dropped more than a fift h against the dollar since last November which, while making
        exports to countries outside the euro area more competitive, makes it is more expensive to import
        goods.

        The rate of imports, already subdued, is likely to be even weaker later this year given euro weakness
        and as Chinese and Kazakhstan alloy exports to the EU are subject to anti -dumping duties of more than
        7% on average.

        Moreover, there have been only low levels of exports shipped from Norway, Ukraine and South Africa,
        dealers said.

        Yet the current price trend may be short-lived.

        European steel makers had been increasing their rate of production this year to currently some 80% of
        utilized capacities, from about 70% at the start of this year. Yet Europe-based ArcelorMittal, the world's



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          22
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        biggest steel maker, said recently it was considering halting up to three European blast furnaces in the
        third quarter this year to meet expected weaker demand.

        Underlying cons umption in E urope may weaken in the second half of this year against a raft of national
        austerity programmes across the area, undermining a fragile economic recovery from recession,
        dealers said.

        European SiMn market set to extend consolidation
        Metal-Pages, 10/06/10

        The European silico-manganese market has been steady in the past few weeks after gaining more than
        5% around the start of last month, with tight availability and a weaker euro set to persist in shoring up
        support for the alloy in the short term, dealers told Metal-P ages on Wednesday.

        Silico-manganese 65/17 grade spot prices are at €1, 150 -1,200/tonne basis delivered.

        Buying interest among consumers in the steel sector has been relatively busy, although at a low rate,
        and t here are enough orders through this mont h for prices to s ee out the current quarter without any
        losses, dealers said.

        ―There had been market expectation of increased prices before t he end of June, although stability looks
        set to grip the market in the coming weeks as low key interest and limited stocks balance the mar ket,‖
        one dealer said.

        ―Market sentiment is cautious about demand after the seasonal slowdown, although supplies should be
        tight enough in Europe, with limited imports, to stem a sharp drop in prices later next quarter.‖

        European steel makers had been increasing their rate of production this year to currently some 80% of
        utilized capacities, from about 70% at the start of this year. European ferro-alloys producers, however,
        have been disciplined in their production volumes since drastic cuts last year, wi th few stocks to spare
        for spot sales through 2010 so far.

        However, Europe-based ArcelorMittal, the world's biggest steel maker, said recently it was considering
        halting up to three E uropean blast furnaces in the t hird quarter this year to meet expected w eaker
        demand.

        Dealers said currency mark et have also been a factor, although that impact has been mostly supportive
        as there business levels have been fairly muted latterly this quarter.

        The single European currency has dropped more than a fifth against the dollar since last November,
        which, while making exports to countries outside the euro area more competitive, makes it is more
        expensive to import goods.

        The rate of imports, already subdued, is likely to be more subdued later this year given euro weak ness
        and as Chinese and Kazak hstan alloy imports are subject to anti-dumping duties of more than 7% on
        average.

        Moreover, there have been only low levels of material shipped from Norway, Ukraine and Sout h Africa,
        dealers said.

        European ferro-manganese market consolidates gains
        Metal-Pages, 10/06/10

        The European ferro-manganese market has been steady in the past few weeks, consolidating gains
        made earlier in the current quarter, while prices look supported on low levels of stocks in the short term
        despite muted demand, dealers told Metal -Pages on Wednesday.

        High carbon ferro-manganese 75% material is at €1,125-1,175/tonne basis delivered works. Medium
        carbon alloy is around €1,900/tonne and low carbon alloy is about €100 premium to that.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          23
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        ―Business has been low key, although steady in rec ent weeks and it‘s the type of demand the market is
        seeing in the next couple of weeks,‖ one dealer told Metal -Pages.

        ―A vailability is fairly tight and there are only low levels of stocks around, so support is firm and if demand
        picks up at all then the obvious move is for prices to get stronger.‖

        Dealers said there were no reported quarterly deals for the t hird quarter, although a few bids and offers
        have been pitched around current spot price levels. Furt her support has come from a weaker euro
        against a basket of currencies, although that impact has been limited given similar levels of import and
        export business, dealers said.

        There have been buying enquiries on an int er-merchant business level, as well as from steel makers,
        although there has been increasing interest from potential bidders in the United States as the euro
        weak ens against the dollar, dealers said. The single E uropean c urrency has lost about 8% in value this
        year.

        There has been no sign of a drop -off in cons umer orders among steel mills despite an intended 3-week
        shutdown at most steel makers in Europe starting next month and into August, dealers said.

        That may be part of the reason behind consumer reluctanc e to settle quarterly delivery contracts
        through Sept ember after a stronger first half this year. European steel production has been ramped up
        to currently some 80% of annualized capacity, from only two -thirds in January.

        However, ArcelorMittal last said it is considering shutting three blast furnaces in the third quarter this
        year against expected weaker demand, although no firm decision has been made.


                                                                                                CIS                                                                     back to index

        Ukraine ferroalloys producers up output levels sharply from 2009
        Platts, 09/06/10

        Ukraine's leading ferroalloys producers, Nikopol Ferroalloy Plant and Zaporizhia Ferroalloy Plant, saw
        output levels in the first five months of this year rise significantly from January -May 2009 levels,
        UkrRudP rom, an association uniting major metal produc ers, said Tuesday.

        NFP, Ukraine's largest ferroalloy producer, increased ferroalloys output by 6.2% on the month to 88,900
        mt in May from 83,700 mt in April; output was up sharply from 43,900 mt produced in May 2009.

        In May, NFP produced 70,400 mt of silicomanganes e, up from 65,100 mt in April, but production of
        ferromanganese fell t o 18,500 mt from 18,600 mt produced in the previous month. For January through
        May the company produced 401,500 mt of ferroalloys, up from 157, 000 mt produced in the same peri od
        of the past year.

        NFP produced 311,200 mt of silicomanganese in the first five months of 2010, up from 144,300 mt in
        the year-earlier period, while production of ferromanganese increased to 90,300 mt from 12,700 mt.

        ZFP, Ukraine's No. 2 ferroalloys producer, increased ferroalloys out put 3% on the month to 33,800 mt in
        May from 32, 800 mt in A pril. ZFP produced 22,900 mt of silicomanganese, up from 19, 700 mt produced
        in April, while output of ferrosilicon decreased to 4,800 mt from 5, 100 mt and productio n of
        ferromanganese fell to 6,100 mt from 6,400 mt.

        For January through May the company produced 153,700 mt of ferroalloys, up from 55,200 mt
        produced in the same period a y ear ago. ZFP produced 94,700 mt of silicomanganese in January -May,
        up from 23,000 mt in the year-earlier period, while production of ferromanganese inc reased to 29,100
        mt from 16,500 mt, output of ferrosilicon ros e to 23,900 mt from 11,000 mt and output of metallic
        manganese rose to 6,000 mt from 4,700 mt.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          24
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        ICDA - CIS gaining ferro-alloys market share
        Metal-Pages, 27/05/10

        Russia, Ukraine and Kazakhstan are gaining market share over China is bulk alloys, Olga Grigorieva,
        senior analyst at Metal Expert, Ukraine told the International Chromium Development Association
        (ICDA ) meeting in Almaty today.

        In ferro-silicon, manganese alloys and ferro-c hrome respectively, the three large CIS producers have
        the competitive advant age of both offering high grade and broader range of products and unlike China
        not being constrained by export duties. China, whic h has decided to keep duties export duties of 20%
        on ferro-manganese, silico-manganese and ferro-chrome and a 25% duty on ferro-silicon has seen its
        share of the market shrink, and in ferro -chome it is overwhelmingly a net importer. China is self -
        sufficient in ferro-manganese and ferro-silicon, and is a net importer of manganese ore but not alloys.

        The global stainless steel market in 2009 fell to a lesser degree than that of ferro -alloys which saw the
        turnover of manganese alloys market fall by h alf from 5.25 million tonnes in 2008 to 2.78 million tonnes
        in 2009 and a 37% drop in turnover of ferro -silicon to 1.7 million tonnes, Grigorieva said. The ferro -
        chrome market saw the smallest, 15%, drop in turnover to 5.2 million tonnes.

        China's decision to retain the ex port duties on bulk ferro-alloys to protect domestic resources led to its
        market share in manganese alloys falling from 21% in 2008 to just 6% in 2009, while CIS produc ers
        gained 36% of market share, up from 23% in 2008.

        In the ferro-silicon market last year, China lost its 2008 leading share of the market of 47%, which fell to
        26% in 2009. Russian ferro-silicon producers have meanwhile widened their share of the market from
        12% to 17% in the same period.

        In ferro-c hrome, where China is focused on domestic consumption, the market share of CIS produc ers
        was stable over the past two years at 23%, while South Africa increased its market share from 54% to
        57%.

        Metal Expert ex pects global stainless steel production, which fell 22% last year, to return to exceed pre-
        crisis level in 2010. Meanwhile demand for bulk alloys in the main consuming regions will not recover
        until 2012, it forecasts.

        In the CIS, which is an export-orient ed producer of ferro-alloys, in 2009 production of ferro-alloys fell in
        2009 aft er a rise in 2008 and prices followed global trends.

        The region's production of manganese alloys last year fell by 25% and domestic consumption by 21%,
        with exports down by a smaller margin of 17%. In 2010, Metal Expert forec asts a positive trend, with a
        26% increase in production. It expects exports to rise by as much as 37% and a slower 12% growth in
        domestic consumption.

        Ukraine will increase its share of CIS production and step up its output t his year. In 2010 it is expected
        to produce 1,121,000 tonnes of manganese alloys. Of this out put 70% will be exported t o non-CIS
        countries.

        According to Metal Expert, CIS ferro-silicon production fell 14% last year to 680,000 tonnes, with
        domestic consumption down as much as 45% and exports don 1 1% on 2008. This year Olga Grigorieva
        said the forecast is that production will ris e 11% to 670,000 tonnes, with a 50% increase in domestic
        consumption against last year. Ferro-silicon exports could be stable in 2010.

        Ferro-chrome production in the CIS was about 6.5% dome year on year in 2009. Russia is the largest
        consumer in the CIS, but ferro-chrome is primarily an export product for the CIS. According to Metal -
        Expert production should grow 5% this year, and Kazakhstan, the largest producer is targeting the
        Southeast Asian market. In 2009 70% of CIS exports of ferro -chrome wet to Southeast Asia.

        The largest producer of manganese alloys in the CIS is Privat Group which controls Nikopol,
        Zaporozhye and Stakhanove smelters in Ukraine and owns US producer F elman, Georgia's Zestafoni


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          25
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        plant and the currently idle Feral and Stalmag plants in Romania. The group is an integrated producer
        whos e assets, apart from manganese mines in Ukraine, include Ghana manganese and Consolidated
        Minerals in Australia - it is planning to incorporate the latter. It accounts for 8% of global production of
        manganese ore making it the third largest producer in the world and in 2009 it was the world's second
        largest after B HP.

        ChEMK group is Russia's largest producer of ferro-silicon, including its flagship Chelyabinks plant,
        Kuznetsk Ferroalloys plant and Yurga Ferroalloys, a new plant which manufactures nine types of silicon
        alloys. The company's advantage as a producer is the availability of locally generat ed energy which is
        significantly cheaper than in China.

        ENRC in K azakhstan is the world's largest produc er of ferro-chrome by chromium units. "ENRC intends
        to acquire a stake in Samancor in South Africa which will boost ENRC's share of the global market,"
        Grigorieva s aid.  Although the two produc ers are competitors in the market, the shareholders of
        Samancor's owner IMR are also the founding shareholders of ENRC.

        Again Kazkhstan's advantage over other producers is the abundant integrat ed power supply - ENRC
        generated 14.5% of all Kazakhstan's electricity in 2008.

        "The CIS produc ers have a competitive advantage in the ferro -alloys market," Grigorieva said.
        "Ukrainian silico-manganese contains 73%-75% manganese which is a very high grade compared with
        the world average of 65%. Russian ferro-silicon producers' competitive advantage is that they can offer
        a wider range of grades than China. The advantage of the ferro-chrome produced in Kazakhstan is its
        blending ratio, high in chromium and low in titanium, silicon and phosphorus.

        "...The geographic location is another advantage as the Baltic and Black Sea ports means Russian
        producers can easily transport material anywhere to neighbouring countries in Europe, in Asia and the
        Middle East."


                                                                         AFRICA & MIDDLE EAST                                                                           back to index

        Union says hope s to reach deal with Eskom
        Reut ers, 21/06/ 10

        South Africa's biggest union said it was hopeful fres h wage negotiations on Monday with state -owned
        power utility Eskom could avert a strike that could disrupt electricity supply during the World Cup.

        "I hope it won't come to a strike," said Lesiba Seshoka, spokesman of the National Union of
        Mineworkers (NUM), which last week warned its members could down tools in a labour action that could
        cripple manufacturing and mining.

        "We are prepared to give negotiations a chance, but if there is no resolution, then we will call for a
        strike."

        The union, which represents about half of the 32 000 workers at the utility, wants a pay rise of more
        than three times the inflation rate of 4,8% as well as a housing allowance.

        Eskom has offered an 8% raise and a once-off, 1% payment as a housing allowance. Analysts see a
        last-minute deal as likely.

        Seshoka said the unions were ready to give the talks a chance for a few days after being advised by a
        mediator to tone down their strike threats.

        Should the strike go ahead, two other unions have said they may join in the work stoppage, raising
        concerns about power supply in Africa's biggest economy.

        An official at Eskom said the talks were due to start later in the afternoon, and may run for a few days in
        a bid to prevent a strike during the first World Cup on the A frican continent.

  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          26
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The three unions threatened to strike over pay last year, but backed down at the last minute aft er they
        won an increase much lower than what they had demanded.

        Eskom has said should the strike go ahead, it will implement contingency measures to minimise the
        impact.

        A strike is unlikely to hamper electricity supply to stadiums that have standby diesel generat ors, but may
        anger millions hoping to watch matches on television.

        Worse still for the economy, manufacturers and mining companies in the world's top platinum and fourth
        largest gold producer could be forced to shut operations, and this may likely impac t metal production
        and prices, analysts said.

        A possible work stoppage at Eskom follows a series of threats of labour action to freeze transport,
        abandon security posts and tie up immigration at airports during the World Cup if demands for better
        wages and working conditions were not met.

        Economists have criticised unions for using the World Cup to squeez e pay hikes far above inflation,
        which could dent the economy as it emerges from its first recession in 17 years.

        Eskom workers, represented by three unions - the NUM, the National Union of Metalworkers of South
        Africa and Solidarity, originally demanded an 18% wage inc rease and a housing allowance, while
        Eskom offered 5,5%.

        Eskom has increased its wage offer and the unions lowered their demand to 15%.

        Seshoka said the average worker at Eskom earns about R5 000 a month, and a housing subsidy of R1
        000. The unions want this replaced by a housing allowance of R5 000.

        Gabon to tale stake in France's Eramet
        Reut ers, 17/06/ 10

        Gabon has agreed to buy a stake in French mining group Eramet and to raise its holding in their joint
        local manganese miner Comilog to around 35 percent from 25 percent, an Eramet spokesman said on
        Thurs day.

        The agreement in principle was reached by Gabon President Ali Bongo and Eramet Chief Executive
        Patrick Buffet, the spokesman said.

        Frenc h daily Les Echos had report ed Gabon agreed to buy between 4 percent and 5 percent of Eramet.

        The Eramet spokesman however had no details on the size or the timetable for the deal.

        A source close to the matter recently told Reuters Bongo wanted his count ry to take a stake in Eramet.

        Such a move would give it a similar status to the provincial authorities in New Caledonia, which, through
        holding company STCP, are minority investors in Eramet's nic kel subsidiary SLN and own 4 percent of
        Eramet.

        China firm to build new manganese processing plant
        Metal-Pages, 15/06/10

        Superdeal Investment, a Chinese firm, is set to establish a large -scale manganese furnace to process
        manganese ore in Kabwe, Zambia at a cost of more than $2 million, according to the Times of Zambia.

        Company chief executive officer, Luobin Bin Luo, said the furnace in the Central P rovince town will
        enable them to process manganese ore in Zambia instead of exporting the raw material, according to
        the report.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          27
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        He said the development will contribute to the growth of the Zambian economy in adding value to
        manganese, and that the development of the new furnace will create about 400 jobs.

        ―We have a huge investment in Zambia and our plans are to put up a large furnace besides the plant we
        have,‖ he said in the report.

        ―We have already presented our investment plans to the Zambia Development Agency and our intention
        to construct a furnace right here in Kabwe which will boost our production.

        ―Right now there is little activity at our plant because of the non-availability of raw materials‖.

        South Africa boosts manganese, chrome production
        Metal-Pages, 11/06/10

        South African production of mined manganese and chrome jumped in April this year, according to
        Statistics South Africa (Stats SA) this week.

        Manganese ore more than doubled at 104% year-on-year, while chromium ore production jumped more
        than 42%.

        However, copper production fell almost 22%, nickel production fell about 20% year-on-y ear and
        platinum-group metals (PGMs ) production was off more than 8% year-on-year.

        Jupiter advances manganese project in South Africa
        Metal-Pages, 11/06/10

        Australian junior miner Jupiter Mines has almost complet ed its acquisition of a 49.9% stake in the Tshipi
        Kalahari Manganese Project in South Africa from a group of investors, Pallinghurst Resources and
        Investec, and will start drilling at its Oakover Manganese project this month.

        Jupiter expects all aspects of the Tshipi trans action to be finalised promptly.

        That will mean seeking shareholder approval for the t ransaction through an extraordinary general
        meeting (E GM) in August this year. The Department of Mineral Resources has awarded the mineral
        rights for the Tshipi Project.

        Jupiter will start drilling at its Oakover Manganese project this month. The company has identified a
        number of first pass exploration targets, which will form the basis of an exploration programme. Jupiter
        had earlier reported ex ploration results from Oakover, with high-grade surface sampling results
        assaying up to 62.6% manganese.

        Transnet hope s to pursue big commodity -linked expansions in partnership with private sector
        Engineering News, 10/ 06/10

        State-owned transport utility Transnet has finally accepted the bulk of the blame for the ongoing
        underperformance of the export coal line from Mpumalanga provinc e, to the port of Richards Bay, in
        KwaZulu-Nat al, which recorded its fift h straight year of volume decreases in 2009/10.

        Acting CEO Chris Wells admitted on Thursday that th e disappointing performanc e was primarily the
        fault of Trans net Freight Rail, notwithstanding the softening of the coal export market in line with the
        recession and some seasonal factors that affected delivery from the mines themselves.

        The matter has been the subject of something of a public blame game between the freight logistics
        group and South Afric a's coal miners since 2005, during which period the export channel has not once
        operated at its 71-million-ton a year nameplate, and volumes have consistently decreased.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          28
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The line disappointed yet again during Transnet's 2009/10 financial year, when 61,8-million tons of the
        material, which is used t o fuel power stations in Asia and Europe, was moved - it was also the line's
        worst performance in five years.

        In fact, volumes have slipped by 3% on a compound yearly basis between 2006 and 2010, falling from
        68,8-million tons in 2005/6 to a dismal 61, 8-million tons in 2009/10.

        "Export coal has not been a good story for the past five years," Well lamented, adding that the line had
        been in persistent decline from the world -class levels achieved during 2004/5.

        However, he said t hat the group was "determined" to turn the line around and "move coal onto a growth
        trend", noting that during the final quarter of the financial year t o March 31, 2010, volumes were
        increased by 6,3%.

        Trans net was working with the coal industry to close the gap between the current performance and the
        available capacity of close to 70-million tons, as well as on a plan to raise throughput to 81-million tons
        by 2014/ 15 and beyond that level, to between 90-million tons and 100-million tons, at a later stage.

        However, the R15-billion project necessary to achieve that target would depend on it securing take-or-
        pay contracts from the coal miners, which would only participate if they were confident about market
        prospects and if they were able to secure sources of supply.

        The privately held Richards Bay Coal Terminal had recently been expanded to handle 91-million tons,
        but wells said that rail was only one impediment to matching that capacity, with an inadequacy of mining
        capacity being the other.

        Currently, the coal miners were also on short-term tariff contracts with Transnet while the det ails of the
        expansion plans were being considered.

        IRON-ORE AND MA NGA NESE

        By contrast, the utility had already signed take-or-pay contracts with the Kumba Iron Ore and Assmang
        to raise throughput to 60,7-million tons by 2013/14.

        In 2009/10 the export volumes on the iron -ore line from Sishen to Saldanha Bay grew by 21,5% on the
        previous year to 44, 7-million tons and plans were in plac e to rail some 50-million tons in 2010/11.

        "We are also in talks with the iron-ore and manganese miners about the next big expansion," Wells
        said.

        The iron-ore industry would like to increase its yearly exports to 80 -million tons, while the manganese
        miners, which were currently restricted to yearly exports of seven-million tons, through Port Elizabeth
        and Durban, were keen to raise that to bey ond 14-million tons.

        The manganese i ndustry is keen to piggyback on the Sishen -Saldanha success and ex port this
        additional tonnage through the West Coast harbour, but Transnet was still considering a plan that
        involved exports through the new Ngqura harbour, in the Eastern Cape.

        Wells said that there was still no finality on which route would be selected, but stressed that the
        feasibility studies were being conducted jointly with the industry, with the support of an independent
        consultant.

        He said t hat the project would involve capital expenditure well in excess of the R15 -billion required to
        expand the coal channel.

        In fact, Transnet is hoping to pursue both the iron-ore and the manganese expansion under its private
        sector partnership (PSP) scheme, which still required sanction from its shareholder.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          29
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        However, the PSP plan is anticipat ed to be opposed by some elements of the governing political
        alliance of t he A frican National Congress, the South A frican Communist Party and the Congress of
        South African Trade Unions (Cosatu). Cosatu, in particular, is likely to oppose any move that could be
        perceived as an effort to privatise the count ry's rail, ports and pipelines.

        But Transnet said that it did not want to be an impediment to the growt h in mineral exports, such as
        coal, iron-ore and manganese, as it has been previously, owing to its balance sheet constraints.

        A separat e PSP unit had already been established to create the capacity to pursue public -privat e
        partnerships, but Wells said that he could not discuss project details until its PSP approach had been
        approved by its board and its shareholder.

        In fact, given the political sensitivities surrounding the model, it was likely that Cabinet would have to
        endorse the proposal - a process that Transnet hoped would be completed during 2010.

        SiMn up as South Africa works through backlog
        Metal Bulletin, 07/06/10

        Silico-manganese rose on Friday as buyers struggled to source mat erial in the aft ermath of the
        Trans net strike.

        Workers at South A frica‘s transport parastatal went on strike in the second week of May over a wage
        dispute, causing major bulk alloy producers and traders to declare force majeure on shipments out of
        South Africa.

        Though the strike has now been resolved, the backlog of material piled up at Sout h African ports is only
        slowly being worked through.

        ―The problems in South Africa are causing a bit of a scramble for material, and higher prices are being
        quoted,‖ a trader said.

        Silico-manganese basis 65-75% rose to €1,180-1,250 ($1, 416-1,500) per tonne from €1,100-1,200 per
        tonne previously, and mark et participants said the lower end of the range is already no longer available.

        ―We sold at the start of the week at €1,180 [per tonne] and I already wish we didn‘t,‖ the trader said. ―I
        wouldn‘t sell there now, and I‘m confident that it will be well above €1,200 shortly.‖

        Buying interest spiked in the week as consumers looked for replacement mat erial to thos e units tied up
        in South African ports.

        ―We had enquiries for 500-1000 tonnes yesterday, and when you get enquiries like that it‘s clear t hat
        something‘s happening,‖ the trader said. ―There are no offers below €1,200 anymore.‖

        With stacks of containers still held at South African ports that will take some time to clear, prices could
        rise further despite t he uncert ainty plaguing the commodities markets due to the eurozone debt crisis
        and questions over the sustainability of industrial demand in China.

        Ethan Minerals Commence s Trial Mining At Zambia JV Manganese Project
        Proactive Investors, 07/06/10

        Ethan Minerals has commenced initial trial mining on several of its manganese project sites, as part of a
        trial for the company‘s due diligence process at its JV manganese project in Zambia, Southern A frica.

        Ethan said in May the JV prospects had identified outcrops of manganese which are currently being
        mined by traditional open pit methods. The company expects economic mining to commence on
        conclusion of the due diligence process.

        Ken Fitzgerald, executive director, said sampling of the manganese ore is currently being carried out on
        several of the current in-situ ore exposures, each of the trial mine packages as part of Ethan‘s due


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          30
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        diligence process and all current ore stockpiles.


        All samples will undergo independent analysis with the complet e res ults being announced once
        received, along with the confirmation of additional developments within the next couple of weeks.

        Ethan announced on 20 May 2010 a JV through its wholly ow ned subsidiary Allegra Mining Zambia with
        the Zambian based company Eagle Eye Mining Zambia Limited.

        Under the terms of the JV, Allegra Mining will "derive 70% of net revenues existing in identified
        prospects and any future prospects offered by Eagle Eye to Allegra Mining."

        The JV covers an area of approximately 77km² and encompasses 5 known manganese prospects
        located 20km from existing infrastructure including a railway loading station that runs to the port of Dar
        Es Salaam.

        Arrangements are in place with the port authorities of Dar Es Salaam to receive and ship the
        manganese ore.

        Mining injects US $2.9bn into economy
        My Joy (Ghana News ), 02/06/10

        Ghana‘s mining and mineral industry injected a t otal of US $2.9 billion into the economy in 2009,
        representing an increase of 27 percent from the 2008 figure of US$2.3billion.

        Manganese revenue also increased, by four percent from US $62.3million in 2008 to US$64.9 million in
        2009.A strong res ult, considering the fact that shipment of the mineral declined by s even percent from
        1,089,025 tonnes to 1,012,941 tonnes in the same period.

        The fall in shipments was on account of the credit crunch, which had a huge adverse impact on
        businesses all over the world as well as on the demand for minerals.

        Business for Ghana Manganese Company started to improve from the beginning of the second quarter
        onwards, following a rise in the global aggregate demand for the mineral.

        In these circumstances the company was able to increase the price of manganese, which event ually
        increased its revenue.

        Ivory Coa st Mn ore shipments off 25% in Jan-Apr ‘10
        Metal-Pages, 01/06/10

        Ivory Coast exported more than 37, 000 tonnes of manganes e ore in the first four months of this year, off
        almost 25%, or more than 12,000 tonnes shipped in the s ame period last year, according to official
        customs data.

        The country shipped about 7,900 tonnes of ore in April this year, from about 35,000 tonnes in April
        2009.

        Ivory Coast exported about 147,500 tonnes of manganese ore in total last year – off about 29,000
        tonnes, or 16%, on more than 176,000 tonnes shipped in 2008, data showed.

        Shipments had been affected on work stoppages at one of the mines in t he country in the first six
        months of last year.

        S Africa transport stri ke may end on new deal
        Metal-Pages, 27/05/10

        South African state-owned transport utility Transnet looks set to reach a wage deal with union work ers
        on Thursday to end a transport strike that has crippled rail and port infrastructure.

  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          31
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The strike, now in its third week, has affected metal exports in one of the world's biggest suppliers of the
        power station feedstock, and may impact the country's target of exporting 65 million tonnes this year.

        The transport strike has also dented exports of coal, cars, fruit and wine to Europe and As ia, as well as
        imports of car parts and fuel and cost the S outh A frican economy at least 7 billion rand ($890 million) in
        lost production and sales.

        The South A frican Trans port and Allied Workers Union (Satawu) said a majority of its members had
        voted for a new offer from Transnet.

        "We do have a majority... but we are still waiting for votes from one province. We want to hear from
        them before we make the call," Satawu Ezrom Mabyana told news agency Reuters.

        Recent strikes have drawn criticism from economists and the central bank who say unions are trying to
        hold the government and state enterprises to ransom by staging strikes close to the soccer World Cup,
        to squeeze pay increas es above inflation of 5.1%.

        Analysts said the strike is set to have long-lasting consequences on the country's exports, with South
        Africa losing some contracts to other markets, such as India or Brazil. Retrenchments may also be
        looming, they said.

        World miners with operations in Sout h Africa, such as Anglo American, Xstrat a and the world's top steel
        maker ArcelorMittal have declared force majeure on the supply of iron ore, ferro -chrome and steel.

        However, manganese supply in South A frica, one of the world‘s major suppliers, was being shipped
        domestically and internationally, South African suppliers told Metal-P ages.com a couple of weeks ago.
        (http://metal-pages.com/news/story/46763/ )


                                                                                        AMERICAS                                                                        back to index

        US ferro-manganese market ease s again
        Metal-Pages, 21/06/10

        Spot ferro-manganese prices in the United States have eased again in the past couple of weeks amid a
        steady rate of offers from suppliers looking to book profits before the seasonal slowdown, dealers told
        Metal-Pages on Monday.

        ―Steel makers are not really interested in buying raw materials before the shutdowns and things have
        stabilised in terms of production in the steel sector,‖ one dealer said.

        ―That and what looks like a slowdown in demand in the second half of this year, from the first six
        months, is encouraging cheaper o ffers.‖

        Dealers said they expected more losses in short term ferro -alloys prices until the steel sector returns in
        full and a clearer picture appears of demand through the rest of the third quarter.

        High carbon material has eased to $1, 350 -1,400 a long ton basis delivered, while refined ferro -
        manganese grades, such as medium carbon material have moved to $1.30 -1.35 a pound and low
        carbon ferro-manganese to $1. 40-1.45/lb.

        Steel makers have been building stocks from t he spot market where s uppliers have been offering some
        of the 24,000 tons of manganese alloys sold by the government in April.

        A strengthening dollar is also spooking alloy suppliers, as a stronger domestic currency typically attracts
        more imports.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          32
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The latest US steel industry data showed that capacity utilization dropped about half a percent to a
        fraction below 74% in late May, the first weekly drop in recent mont hs.

        Brazilian steelmakers count electricity cost impact on alloys
        Metal-Pages, 21/06/10

        Brazilian steelmakers are complaining abo ut the rising cost of electricity, which they say discourages
        the production of products such as ferro -alloys and aluminium, the Valor Economic o newspaper
        reported.

        Usiminas boss Wilson Brumer last week pointed to inflation rises totaling 150% since 2002, underlining
        that inflation has risen by 83% in comparison over that period.

        Electricity costs can amount to as much as 40% of the c ost of ferro-alloys and 35% of aluminium,
        according to Brumer's calculations.

        ―New production of these items is no longer economically viable,‖ Brumer reportedly said.

        Brazilian ferro-alloys producers have so far presented a mixed picture of the year, with some saying
        buying is already back to pre-crisis levels and others such as Gerdau‘s speciality metals division saying
        it is unlikely to do so until 2012.

        Brazil's steel consumption will grow 24. 4% to 23.1 million tonnes this year, while exports are estimated
        to increase 27.4% to 11 million tonnes, the Brazilian Steel Institute (IABr), the trade body representing
        the sector forecasts.

        The Brazilian economy grew by 9% in the first quarter compared to the same period last year - the
        biggest such increase since statistics began being recorded under the current system, according to
        figures released by national statistics institute IBGE.

        The economy grew 2. 7% in the three months of this year versus the closing quarter of 2009 – the
        biggest increase since the first quart er of 2004, when the economy expanded 2.8% versus the previous
        three months.

        Vale mulls new ferro-alloy plants in Brazil
        Metal-Pages, 17/06/10

        Brazilian miner and steelmaker Vale is considering setting up two new manganese ferro -alloy capacity
        in the country, José Carlos Martins, Executive Director for marketing Sales and Strategy, Ferrous told
        Metal-Pages at the recent IMnI conference in Paris.

        "We are looking to replace the existing old plant with new capacity to meet demand," he explained. "We
        are looking at capacity of 500,000 tonnes in the south, and the same capacity in the north. Where we
        will build the plant depends on whether we want to be close to the market in the south or close to the
        mines, and also power supply - and the power is in the north."

        The company's main manganese mine (Vale's total capacity is some 3 million tpy of ore), is Azul in Pará
        state in northern B razil. The company's current capacity of some 495,000 tpy of manganese alloys is
        centred further south in Minas Gerais and B ahia, where the company's smaller mining operations are
        located. The main market, i.e. the bulk of the steel capacity is also in the south. Vale director Pedro
        Gutemberg explained that it may make sense to locate the plant in the south to minimise the transport
        distance to customers.

        The timescale of the project is still uncertain, "currently we are considering it, " he said - and the project
        will also have to clear environmental hurdles, which will take time.

        "Brazil has very tough environmental regulations, for mining and for the industry in general, so getting
        environmental approval is diffic ult and it is a very long process. This can take several years," he said.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          33
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Brazil's demand for manganese alloys is set to grow by more than 50% over the next five years, with
        Vale projecting an increase of 35,000 tonnes in 2011 and increases between 20,000 and 30,000 tpy in
        the years to come in line with steel expansions, Martins said in his presentation at the conference.

        This will take annual consumption from less than 300,000 tonnes projected this year to more than
        425,000 tonnes by 2016. The growth is supported on one s ide by the captive manganese mines, and on
        the other by the growing domestic steel sector. Once Vale's four steel projects across the country are
        implemented over the next three to five years, domestic steel capacity will go up by another 15.5 million
        tpy of slab. The first project, 5 million tpy CSA plans in Rio de Janeiro, whic h is a joint vent ure with
        ThyssenKrupp will be commissioned this Friday, June 18, Martins confirmed.

        Brazil's manganese industry growt h is also supported by China's growing demand for high grade
        manganese ore - Chinese ferro-alloy producers always blend domestic and imported ore. The share of
        imported (seaborne) ore in china's consumption is growing, from 41% in 2007 to 57% in 2009,
        according to Vale, and is expected to increase further from 58% estimated this year to 60% in 2011.

        Brazil and Vale have increased their expected share from 6% (V ale 4%) of China's manganese ore
        imports in 2007 to 13% (Vale 10% ) last year. The company is trying to capitalise on its manganese
        resources by maximising production from its Azul mine, by using lower grade ore and fines. It is
        planning t o build a pelletising plant, to be commissioned in 2013 to enable it to use ore fines and offer a
        premium product, as it does in its iron ore segment.

        The link between Brazil as a supplier and China as a customer is mutually important, however there is
        good case for relocating more steel production to Brazil, closer to resources, Martins said. "My advice is
        go West and South," he said.

        "To produce one tonne of steel you need to move four tonnes [of raw materials] - if you have a well
        located steel mill then your production will be low cost," Martins explained. "CSN steel owned by
        ArcelorMittal is the lowest cost producer in the world. In Brazil you can benefit from a growing steel
        market and the low cost of production."

        At $298/tonne of steel slab in 2009, Brazil sits at the bottom of the global steel cost curve, before CIS at
        average $308/tonne and on the other end from China at the high end at $413/tonne. This compares
        with the world average of $370/tonne, Martins pointed out.

        The historical EBIDTA margin of Brazilian companies, at 32% is much higher than the 14% world
        average, and over the course of five y ears (2005 -2009) Brazil's leading steelmakers offered on average
        a 42% shareholder return, as against the world average of 15%.

        Vale has four major steel ventures totalling 15.5 million tpy at various stages of development, including
        ThyssenKrupp-V ale joint venture CSA with 5 million tpy of capacity, which will be commissioned before
        the end of this week.

        Others are A LPA in Pará state in the north, which will have capacity to produce 2 million tpy of slab and
        0.5 million tpy of rolled products and is scheduled for start up in 2013 and, also in the north, CSP in
        Ceará with 3 million tpy of slab capacity, with a 2014 planned start -up.

        In the south, the 5 million tpy CS U plant planned in Espírito Santo is expected to e commissioned in
        2014 or 2015.

        US silico-manganese market falls almost 10%
        Metal-Pages, 07/06/10

        The spot silico-manganese market in the United States has fallen almost 10% in the past couple of
        weeks, dragged down on increased offers against weak er consumer buying interest as the seasonal
        slowdown approaches next month, dealers told Metal -Pages this week.

        US spot silico-manganese prices have moved to 62 -65 cents a pound, from 69-71 cents/lb. Last
        October the market hit an annual peak of 75 cents/lb.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          34
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        ―Steel makers seem content to use their stocks in the run-up to seasonal shutdowns next month and it
        seems they will be little interested in buying from the spot market for most of July and possibly early
        August,‖ a dealer said.

        US Steel, the number one steel producer in the States, booked several hundred tonnes of silico -
        manganese at 70 cents/lb a few weeks ago, although consumer bids have been rare since, dealers
        said.

        World metals markets, however, have been pressured recently on investor worries about Europe‘s
        ability to control its debt problems and how that may impact on its short -medium t erm i ndustrial growth,
        as well as report ed weakness in spot Chinese iron ore prices and weaker US steel scrap pric es.

        Moreover, US Steel has some operations in cent ral Europe and a fall in European productivity may hurt
        demand for its products, which are used in everything from cars to construction and appliances.

        In terms of US supply, manganes e alloy production issues have also been resolved at domestic
        producer Eramet Marietta, which has repaired and refurbished a damaged furnace that it shut down in
        March.

        However, US steel mills have so far shown little buying interest in raw materials for the third quarter and
        even cheaper s pot prices are ex pected in the short term. The latest US steel industry data showed t hat
        capacity utilization dropped about half a p ercent to a fraction below 74% in late May.

        A strengthening dollar is also spooking alloy suppliers, as a stronger domestic currency typically attracts
        more imports.

        US ferro-manganese market drops under more offers
        Metal-Pages, 03/06/10

        Spot ferro-manganese prices in the United States have dropped again in the past week amid increased
        offers from dealers anxious to cash in ahead of expected further weak ness in the seasonal slowdown
        next quarter, industry sources told Metal -Pages this week.

        High carbon material has lost $50 to $1,400-1,450 a long ton basis delivered, while refined ferro -
        manganese grades, such as medium carbon material have moved to $1. 35-1.40 a pound, from $1.40-
        1.45/lb.

        Low carbon ferro-manganese has also eased 5 cents to $1.45 -1.50/lb.

        ―The market is expecting prices to drop anot her 5% or so, perhaps more, in the coming weeks as steel
        makers have indicated they will shut for 2-3 weeks in July and into August,‖ a dealer said.

        ―Steel makers have been building stocks from the spot market where suppliers have been offering some
        of the 24,000 tons of manganese alloys sold by the government in April, and dealers want to get as
        much as that off their books as possible before prices drop again.‖

        Dealers said uncertainty about consumer demand aft er the seasonal slowdown in the States, which is
        going through a fragile economic recovery after a huge slump, has also prompted increased offers from
        suppliers.

        Manganese alloy production issues have also been resolved at US producer Eramet Marietta, which
        has repaired and refurbished a damaged furnace that it shut down in March.

        However, steel mills have so far shown little buying interest in raw materials for the third quarter and
        cheaper spot prices are expected in the short term. The latest US st eel industry data showed that
        capacity utilization dropped about half a percent to a fraction below 74% in late May.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          35
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        A strengthening dollar is also spooking alloy suppliers, as a stronger domestic currency typically attracts
        more imports.

        DNS C announce s amended offerings of stockpile metals
        Metal Bulletin, 01/06/10

        The Defense National Stockpile Center (DNSC) has announced the dates for its amended offering
        schedule for ferrochrome, chromium met al, ferromanganese, beryllium and germanium.

        Ferromanganes e, previously offered monthly, will be posted on a bi-monthly basis on the second
        Tuesday in February, April, June, August, October and December.


                                                                        GENERAL INFORMATION                                                                             back to index

        Ryan’ s Note s Weekly
        Ryan’s Notes, 21/06/10

        US bulk ferroalloy buying underway

        Third-quarter bulk ferroalloy buying was under full swing last week. Most of t he business booked last
        week was for silicomanganese, with prices ending up around 64¢, delivered, for bargeload quantities.
        Some of the fixed-price material was for second half 2010 shipment. Small quantities of highcarbon
        ferromanganese were concluded at $1,380 per lt, delivered; there was no appreciable medium - or low-
        carbon ferromanganese business.

        Eramet Marietta is running two furnaces to make high-carbon ferromanganese and is working to start its
        third furnace to produce silicomanganese.

        Prices for 75% ferrosilicon ended the week at around 62¢, ex warehouse, and there was a growing
        resistance by sellers to lower their prices. Due to the Chinese holiday, there were no signific ant
        changes in Chinese bulk ferroalloy prices last week. A European mill purchased 600 mt at €1,290 per
        mt, ddp, but sellers said the mill could take 74% Si material with a 2% Al
        and 0.10% C content. Other businesses were concluded at around $1,330, delivered.

        ―No one is looking to move the needle this quarter,‖ one seller said. ―We are just hoping to hang on to
        the current price levels.‖

        The EU has decided to retain the import duty on primary aluminum at 3%, or half the ―normal‖ duty. The
        EU still hasn‘t made a decision on a request by a few member states to eliminate or substantially
        reduce the normal duties on a wide range of products, including most ferroalloys. The ferroalloy duties
        are likely to be modified, but there is some question on whether the EU will reduce the normal duties on
        commodities, such as silicomanganese and ferrosilicon, that are also subject to penalty duties.

        US imports of high-carbon ferromanganese were 49, 225. 2 mt in the first four mont hs of 2010 and
        10,276.9 mt in April vs. 30,028.1 mt and 2,401.1 mt, respectively, in the same 2010 periods. The major
        suppliers in the first four months of 2010 (A pril 2010 in parent heses) were: South A frica, 31,976.4 mt
        (7,907.5 mt); France, 4,726.6 mt (0); and Kazakhstan, 1,450 mt (1,450 mt).

        Imports of medium -carbon ferromanganese were 26,594.4 mt in the first four months of 2010 and
        4,442.2 mt in April vs. 9,178.4 mt and 1,341.9 mt, res pectively, in the same 2009 periods. In A pril,
        Mexico suppli ed 1, 641. 3 mt, while South Africa contributed 1,267.5 mt. US imports of low -carbon
        ferromanganese were 18,315.7 mt in the first four months of 2010 and 4,365.9 mt in April, of which
        2,434.6 mt came from China and 1,900 mt came from Mexico.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          36
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The US imported 44,350.4 mt of 55-80% ferrosilicon in the first four months of 2010 and 6,553.8 mt in
        April vs. 18,758.1 mt and 1, 705 mt, respectively in the same 2009 periods. Major suppliers in the first
        four months of 2010 (A pril in parentheses ) were: Russia, 30,307.4 mt (5,247 mt); China, 4,484.9 mt
        (100.4 mt); Canada, 3,647.1 mt (894.4 mt).

        US imports of silicomanganese were 93,392 mt in the first four months of 2010 and 22,411,8 mt in April
        vs. 41,030.7 mt and 2,597.6 mt, respectively, in the same 2009 periods. The major suppliers in April
        (first four months in parentheses) were: South Africa, 13,078.9 mt (51,752.9 mt); Australia, 5,398.7 mt
        (14,051.3 mt); Mexico, 1,800 mt (4,800 mt); Norway, 1,519.3 mt (12,326.7 mt). In A pril Georgia supplied
        600.8 mt and 5,153.3 mt in the first four months of 2010; most analysts believe the Georgian material
        was imported by Privat for Felman.

        Gabon and Eramet have reached a tentative agreement that would allow the Gabonese government to
        increase its stake in Comilog to as much as 35-40%, up from 25%. The African country also wants to
        buy an int erest in Eramet, Comilog‘s parent company of between 4 -5%. An Eramet spokesman gave no
        details on the size or the timetable for the deal.

        Ryan’ s Note s Weekly
        Ryan’s Notes, 14/06/10

        Manganese alloy tags under pressure

        With US bulk ferroalloys in a surplus, the market was surprisingly competitive last week. High - and
        medium-carbon ferromanganes e suffered the greatest price erosion, while ferrosilicon prices were down
        only marginally. Most sellers have little confidence that third-quarter buying would be at second-quarter
        levels. European ferrosilicon prices, however, were down to around €1,300 per mt despite the
        weak ness in the euro.

        While most of the Chinese bulk ferroalloy prices were unchanged, ferrosilicon quotes jumped back
        above $1,420 per mt, f.o.b. The immediate rise in the price was triggered by higher energy costs even
        though the smelters realized that the export market is no longer viable. A long -term concern, however,
        is that the Chinese government is planning to do away with some export tax breaks and may even
        increase the export VAT just when Western governments are complaining to the WTO. As a result,
        many sellers have put in clauses that obligates the buyers to pay for any adjustment. The only other
        option is for buy ers to export the ferrosilicon before July 1, when the new regulations are supposed to
        take effect.

        ―Once again the mark et is reacting to possibilities but not facts,‖ one analyst said. ―Still there are real
        risks that no one can afford to ignore.‖

        Chinese exports of electrolytic manganes e metal and some manganese alloys continue to be affected
        by smuggling through Vietnam whic h enables exporters to evade the 20% export duty. Smelters located
        along the China Vietnam border have been active exporters, making inland smelters less cost
        competitive. However, the government has yet to crack down on the smuggling.

        China legally exported 40,012 mt of manganese metal in t he first four months of 2010 v s. 32,894 mt in
        the same 2009 period. Exports were mainly to Japan, 16,109 mt (6,408 mt in the
        same 2009 period); to Rotterdam, 5,202 mt (11,048 mt); US, 4,129 mt (820 mt); and S outh K orea,
        3,187 mt (9, 617 mt).

        China‘s legal exports of silicomanganese were 24,017 mt in the first four months of 2010 vs. 34,895 mt
        in the same 2009 period. Exports were to Japan, 14,021 mt (24,603 mt); Taiwan, 1,660 mt (3,833 mt);
        Thailand, 3,100 mt (1,728 mt); and South Korea, 2,574 mt (1, 700 mt).

        DLA did not offer any high-carbon ferromanganese at its latest BOA sale.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          37
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        IMnI conference: Raw materials key for steelmakers - Corus
        Metal-Pages, 14/06/10

        The competitive advantage of cheap labour which had distinguished producing countries
        such as China will no longer be the determining factor in the steel industry as more and
        more of its production costs comes from raw material, Kirby Adams , chief executive of
        Corus told delegates at the International Manganese Institute (IMnI) conference in Paris.

        The raw materials portion, which accounted for 36% of crude steel costs in 2000 rose to
        55% in 2009 and, with the rise in iron ore and coking coal prices in particular, this year is
        expected to make up 67% of the cost of crude steel. China has had a massive impact on
        the raw materials market, accounti ng for two thirds of imported i ron ore consumption worldwide.

        "Labour cost is no longer relevant," Adams said, adding that whereas Asian economies had a great
        advantage in terms of labour costs in the past decades over the more mature count ries, this is
        becoming a less important factor and the playing field is levelling out as efficient use of raw materials
        becomes key to competitiveness. "I am relatively optimistic about the European steel industry because
        in terms of efficient use of raw mat erials it is at the top," he concluded.

        Kirby Adams, who is also CEO and managing director of Tata Steel Europe admitted however that the
        Tata Steel's Indian operations are currently performing better than the European operations. "When you
        have a conversation about the Indian operations of Tata Steel and the European operations of Tata
        Steel, you cannot have a more different conversation," he said.

        Apart from the obviously stronger growth in India while European steel demand remains weak, raw
        materials play a large part here as the Indian operations of the group virtually all have an integrated
        production chain, while the European operations have to rely on purchasing raw materials, witho ut the
        advantage of proximity.

        On the sidelines of the conference, Adams told Metal-Pages that the company is currently exploring for
        metallurgical coal in Wales, near its Port Talbot plant. "When metallurgial coal was at $10/tonne this
        was not so important, now at is at $200/tonne it is worth it."

        If its plans to start up the mine materialise, this would give t he company a supply of some six million
        tonnes per year of high quality coal at the site near Port Talbot, making the plant one of the world's
        lowest cost steel producers.

        The company has been involved in iron ore exploration at several locations, including Guinea, but this
        is in early stages yet.

        At the moment, the European operations are benefitting from the weak euro, which make exports
        competitive as well as from effective us e of raw materials that contribut e a high propo rtion of costs.
        However European demand for steel remains weak. "It will be at least three or four years before we
        revert to levels we have had in 2007," Adams told delegates.

        "We expect 2010 to be a lower year for construction activity in Europe than 2009," he comment ed.
        "Most of the construction activity we have seen in Europe has been a result of government stimulus,
        and with reduced availability lately of finance we we expect this to be reduced."

        His forecast for the mature automotive industry is that it would remain flat bet ween 2010 and 2015, and
        is not expected to return to 2003-2007 levels until past 2015. In the developed nations outside of China,
        including the US and Japan production saw a huge fall in 2008-2009 and is never forecast to come
        back to 2003-2007 levels, Adams said.

        As a result all the growth in production volume will come from developing actions such as China and
        Brazil, while Europe and Japan are set to remain leaders in technology, in terms of research and
        development especially for high speed steels.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          38
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        China, whose production of steel is set to reach 1 billion t py in the next decade is likely to remain a net
        exporter of steel, while Europe whic h was a net importer in 2006-2009 became a net exporter in 2010,
        helped by the weaker local currency. Exports have been primarily of high value added steel products
        and in the fut ure Adams said the region will remain an exporter of high grade steel.

        Cons umption in China, which is the largest user of silico-manganes e units in construction steel is
        meanwhile set to grow as it moves towards more steel intensive construction.

        At the moment less than 15% of its high rise buildings of six storeys or more are of steel frame
        construction, Adams pointed out, as opposed to 70% in the UK. Its shift t owards steel frame
        construction creat es an opportunity for significant growth, especially given the large share occupied by
        construction steel in the Chinese mark et.

        Of the total Chinese market for steel, construction accounts for 61% compared with the automotive's
        sector 4% share, in contrast with the European market where construction steel accounts for 35% of
        steel consumption, automotive for 19% and the lion's share of the market is taken up by other
        mechanical and engineering steels.

        Per capita construction of steel in China and other developing countries is set to grow, while it would
        reach a plateau in developed nations. Currently at the high end of the cons umption scale is South
        Korea, with 1,050 kg per capita annual consumption of steel, while at the lower end are countries like
        India and Indonesia where annual per capita consumption is around 50kg. In E urope, average per
        capita consumption in 280 kg per pers on per year, and in Japan it is 460 kg ppy. China, Adams
        suggested, could catch up with Ja pan and in the longer term potentially be placed in terms of per capita
        consumption bet ween Japan and Korea.

        Global manganese alloy capacity utilisation to ri se
        Steel Business Briefing, 14/ 06/10

        The global capacity utilisation rate of manganese alloy producers is expected to gradually rise and
        recover in these two years, said Colin Ouwehand, manganese market analyst with Vale. Capacity
        utilisation was around 65% in 2009, and this is forecast to increase to about 75% in 2010 and then 85%
        in 2011, according to a presentation by Ouwehand at a recent ferro-alloy conference in Shanghai,
        attended by Steel Business Briefing.

        The increase is due to a supply reduction in 2009 – which has resulted in less overhang in the mark et –
        and ongoing de-stocking and re-stocking in the market, he said. Chinese smelters continue to operate
        at levels even lower than during the global ec onomic crisis due to power supply constraints and reduced
        demand. Hence there is further upside for capacity usage growt h in China, Ouwehand a dded.

        In 2009, global manganese alloy supply exceeded demand by 909,000 tonnes, resulting in high
        inventory levels in the market. But Ouwehand said this gap will narrow to 445,000 t in 2010 and to
        167,000 t in 2011. Supply reduction is the key to achieving relative market balance after the crisis, he
        noted. The rising capacity utilisation will see demand for more seaborne ore rise globally, especially in
        Asia. But supplies of good quality ore – including that produced in Africa, Australia and Brazil – is
        expected to remain tight.

        In the short -term, demand for mid-grade ore like that from Southeast Asia will likely remain stable, while
        demand for low-grade ore – mainly from China – is expected to remain relatively high, he added. Vale
        has a capacity to produce 3.3m t/y of manganese ore in Brazil and 495,000 t of manganese alloys like
        ferro-manganes e and silico-manganese in Brazil, Norway and France.

        MARKET ROUND UP: Outside forces may force up ferro-alloys price s
        Metal-Pages, 11/06/10

        The week brought news that ferro-alloys prices could come under pressure with B HP Billiton and Rio
        Tinto poised to raise iron ore prices by up to 23% in the third quarter.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          39
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The second consec utive quarterly hike would see iron ore priced at around $147 dollars a tonne
        between July and September.

        Since iron ore producers abandoned the traditional annual benchmark price in March, prices have risen
        by around 140%.

        The move by BHP Billiton and Rio Tint o is likely to be matched by Brazil‘s Vale, the world‘s leading
        producer.

        Iron ore may not be alone in facing higher pric es. Adding to this, the Chinese government is report edly
        mulling tight er restrictions on exports of energy sensitive products and strategic resources, including
        steel, ferro-alloys and minor metals, according to sources close to government officials.

        China has eased its control on exports of those products by lowering export duties or increasing tax
        rebates to stabilise export markets since 2008 when the world financial crisis broke out. However, with
        the economy is gradually recovering to the pre-c risis level, tighter control is said to be necessary again
        to save energy and reduce industrial emissions.

        China‘s extensive restrictions on its own exports, such as silicon, are doing more to distort world
        commerce than their supposed goals of protecting the environment and balancing the country‘s trade,
        according to the World Trade Organisation.

        The week also saw Grupo Mexico retake control of Cananea, the count ry‘s largest copper mine, after
        federal police removed protestors who have been on strike for nearly three years.

        The site could be operating again by the end of this year with the c ompany saying it has 2,000
        contracted work ers ready to deploy at the site once it gets the go-ahead from safety officials.

        The prolonged long strike coupled with lower metals prices and demand combined put a halt to a
        planned molybdenum circuit at the Cananea copper mine in nort hern Mexico. The miners‘ leader has
        vowed to regain cont rol of the site.

        SILICO-MA NGA NESE

        The European silico-manganese market has been steady in the past few weeks after gaining more than
        5% around the start of last month. Tight availability and a weaker euro is set to persist in shoring up
        support for the alloy in the short term, dealers told Metal-P ages.

        Silico-manganese 65/17 grade spot prices are at €1,150-1,200/tonne basis delivered. Buying interest
        among consumers in the steel sector has been relatively busy, although at a low rate, and there are
        enough orders through this month for prices to see out the current quart er without any losses, dealers
        said.

        The spot silico-manganese market in the United States has fallen almost 10% in the past couple of
        weeks, dragged down on increased offers against weak er consumer buying interest as the seasonal
        slowdown approaches next month.

        US spot silico-manganese prices have moved to 62 -65 cents a pound, from 69-71 cents/lb. Last
        October, the market hit an annual peak of 75 cents/lb. Steelmakers seem content to use their stocks in
        the run-up to seasonal shutdowns next month and it seems they will be little interested in buying from
        the spot market for most of July and possibly early August, dealers said.

        US Steel, the number one steel producer in the States, booked several hundred tonnes of silico -
        manganese at 70 cents/lb a few weeks ago, although consumer bids have been rare since.

        FERRO-MA NGA NESE

        The European ferro-manganese market has been steady in the past few weeks, consolidating gains
        made earlier in the current quarter, while prices look supported on low levels of stocks in the short term


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          40
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        despite muted demand. High carbon ferro-manganese 75% material is at €1,125 -1,175/tonne basis
        delivered works.

        Medium carbon alloy is around €1,900/tonne and low carbon alloy is about €100 premium to that.
        Business has been low key, although steady in recent weeks and it‘s the type of demand the market is
        seeing in the next couple of weeks, dealers said.

        A vailability is fairly tight and there are only low levels of stocks around, so support is firm and if demand
        picks up at all then the obvious move is for prices to get stronger.

        Dealers said there were no reported quarterly deals for the t hird quarter, although a few bids and offers
        have been pitched around current spot price levels.

        Further support has come from a weaker euro against a basket of currencies, although that impact has
        been limited given similar levels of import and export business.

        The European spot manganese flake market has eased again in price in the past week, amid
        weak ening demand in already quiet business conditions, and aft er recent falls in the value of the euro
        against a basket of currencies.

        European spot prices are off $50 to $2,700-2,750 a tonne basis in-warehouse Rotterdam, depending on
        delivery terms, while manganese lumps in Europe are around a couple of hundred dollars more
        expensive.

        Cons umer demand in Europe has been quiet and is set to be even quieter when seasonal shutdowns
        start next month, dealers said.

        Steelmakers have indicat ed they will be shutting production capacity for about three weeks, which will
        mean restarts in August, although consumers may have enough stocks to last until September.

        BHP Billiton appoints Schutte as head of manganese unit
        Mining Week ly, 08/06/10

        Diversified mining giant B HP Billiton on Tuesday announced a number of appointments and
        restructuring of its management team.

        The company said in a statement that Tom Schutte had been appointed as president of its manganese
        business, replacing Peter Beaven, who had been appointed president of base met als.

        "Beaven's wide experiences across a range of regions and businesses will be of great value to the
        leadership of base metals," said BHP Billiton's nonferrous president Andrew Mackenzie.

        Schutte is currently marketing president at the company and had been r esponsible for driving the
        development of the B HP Billiton marketing model for the past five years.

        BHP Billiton CE of ferrous and coal Marcus Randolph said that Schutte's history across marketing and
        other operational areas within the group would be invaluable in his new position leading the manganese
        business.

        Schutte would be replaced by Mike Henry who had been appointed marketing president, starting in July.
        Henry currently holds the position of petroleum and freight marketing director.

        Ryan’ s Note s Weekly
        Ryan’s Notes, 07/06/10

        Slowdown in US bulk ferroalloy mark et

        Most US bulk alloy sellers were sitting on their hands last week, with little business being conducted.
        Manganese alloy prices fell slightly, but less than some consumers ex pected. Chinese bulk ferroalloy


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          41
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        prices were basically unchanged though resellers said the smelters were getting increasingly
        aggressive. ―Domestic demand is definitely off,‖ one merchant said, ―and sellers now see they will have
        to juice the export market.‖

        Japan‘s Customs stopped accepting Indian silicomanganese imports under GSP from May 18, as the
        imports from India already exceeded 20% of the 50,543 mt set as the ceiling for the fiscal 2010 that
        began on Apr. 1, 2010. The suspension this year came four months earli er than it did last year. The
        GSP import duties are 2% for silicomanganese, instead of ordinary 2.5% duty. The ceiling is for Group
        66 that includes not only silicomanganese but also other ferroalloys such as silicochrome, ferromoly,
        ferrot ungsten, ferrovanadium and others for all GSP countries. However, silicomanganes e was the only
        item so far imported from India under the category.

        While the government did not reveal the GSP tonnage from India, a total of 17,081 mt was imported
        under the whole category at the time of t he suspension. In the last fiscal year, the GSP imports from
        India were stopped from Sept. 16, 2009. The GSP imports from China that were suspended on June 16
        last year have not been stopped yet for this year. Including the imports under GSP , Japan‘s total Indian
        silicomanganese imports skyrocketed to 18,592 mt in A pril, up from 5,297 mt a month ago, and up from
        2,408 mt in April 2009. Imports from China fell to 1,667 mt from 2, 869 mt in March, and from 10,784 mt
        a year ago.

        Japan‘s silicomanganese imports for the first four months of 2010 reached 80,963 mt, up from 47,918
        mt for the same 2009 period. Of the total, 40,859 mt came from India, up from 8,276 mt. The imports
        from China fell to 9,752 mt, from 31,122 mt.

        MARKET ROUNDUP --- Nerves of steel
        Metal-Pages, 04/06/10

        Fears that the European debt crisis would spread to Hungary, sparked by a senior government official's
        warning, and concerns over heavy debt in southern eurozone nations, have dragged the euro below
        US$1.20 this week.

        The European currency has fallen more than 15% against the US dollar since the start of the year, and
        its current woeful state is reflected in the region's steel and metal markets.

        The meeting of the Bureau or International Recycling this week heard a forecast that the global
        stainless steel output would top 30 million t onnes this year, and generally recent forec asts coming from
        steel analysts have been bet ween 28.5 million and 31.5 million tonnes, all of which would be a record
        level. London-based steel consultancy MEPS said this week that 209 crude stainless steel production
        came in just 5% below the 2008 level, and was better than its forecast.

        However the outlook for the third quarter is clouded, and in the meantime steel and steel raw materials
        markets are feeling the pressure. Demand from steelmakers steel seems to be there, ferro -alloy traders
        said, but given volatile currency and falling prices, and fear of building excess stocks, they are buying in
        small volumes, from hand to mout h.

        This week continued to see depressed demand and falling prices for most ferro -alloys, while nickel, one
        of the main stainless raw materials, fell below $19,000/tonne basis three months on the LME, closing at
        $18,350/18,400 on Friday.

        Europe's largest steelmaker ArcelorMittal confirmed today that it is considering shutting down as many
        as three blast furnaces in the third quarter due to expected slower demand. ―In Europe the third quarter
        is characterised by lower demand due to summer vacation shutdowns,‖ the company said in an emailed
        statement.

        China, on which the global steel industry is pinning its hopes for growth is feeling t he impact of
        tightening credit, and falling demand for steel from the aut omotive and construction sectors. Smaller
        steel mills have been shutting furnaces, while the country's largest publicly-traded steelmaker Baoshan
        Iron & Steel Co today cut prices for cold-rolled and hot-rolled coil for the first time in eight months.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          42
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Stocks of iron and chrome ore have piled up at Chinese ports, and the count ry's steelmakers are
        showing little interest in either locally produced or import ed ferro -alloys. In the US meanwhile the
        strengthening dollar is attracting imports, which has contributed to a downturn in domestic market
        prices.

        MANGA NESE

        European spot manganese flake prices have dropped again in the past week on increased availability of
        relatively cheap imported material and slow mark et demand.

        European spot pric es were at $2,750 -2,800 a tonne basis in-warehouse Rotterdam, depending on
        delivery terms, while manganese lumps in Europe are at a widening premium of around $200/tonne.

        ―The European market has been quiet for several weeks now and there have been more, cheaper
        shipments from Asia that has been dragging on European prices more recently,‖ a dealer said. ―The
        trend suggests cheaper European prices in the short term, which might be weighed further as the
        market moves into the start of the seasonal slowdown period next month.‖

        While China has a prohibitively high export duty of 20% of manganes e, whic h has seen official export
        decline, traders say Chinese flake is being smuggled via Viet nam and then stored in warehouses, such
        as Rotterdam, aft er European Customs clearance. Shipments from Vietnam are being offered at
        $2,700/tonne delivered duty paid, and even c heaper, to European dealers, according to market
        sources.

        FERRO-MA NGA NESE

        Spot ferro-manganese prices in the United States have dropped again in the past week amid increased
        offers from dealers anxious to cash in ahead of expected further weak nes s in the seasonal slowdown
        next quarter.

        High carbon material has lost $50 to $1,400-1,450 a long ton basis delivered, while refined ferro -
        manganese grades, such as medium carbon material have moved to $1. 35-1.40 a pound, from $1.40-
        1.45/lb. Low carbon ferro-manganese has also eased 5 cents to $1.45-1.50/lb.

        A dealer said the market is expecting prices to drop another 5% if not more in the coming weeks as
        steel mills plan to shut for 2-3 weeks in July-August. ―Steel makers have been building stocks from the
        spot market where suppliers have been offering some of the 24,000 tons of manganese alloys sold by
        the government in April, and dealers want to get as much as that off their books as possible before
        prices drop again," the source added.

        Dealers said uncertainty about consumer demand aft er the seasonal slowdown in the States, which is
        going through a fragile economic recovery after a huge slump, has also prompt ed a rise in the volume
        of offers from suppliers. Domestic suppliers are also worried that the strong US dollar is attracting more
        imports, which will compete in the domestic market.

        BHP Billiton names new base metals pre sident
        Metal Bulletin, 02/06/10

        BHP Billiton has made Peter B eaven president of its base metals division, following the rec ent
        departure of former president Diego Hernández to Codelco.

        Beaven, currently president of BHP Billion‘s manganese business, will assume the new role on 1
        November 2010.

        Until then, Ivan Arriagada will continue as a temporary president, BHP said in a stat ement sent to MB.

        Beaven has worked at BHP for over ten years, and has held the manganese role since October 2005.

        Before that he was vp of carbon steel mat erials, the company said.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          43
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Global manganese ore output in Q1 up by 29pct YoY
        Steel Guru, 02/06/10

        TE X reported that the world output of crude steel in January to March quarter of 2010 increased by 29%
        to 342 million tonnes in comparison with that in the same quarter of 2009 and, accordingly, the global
        consumption of manganese ore in the first quarter of 2010 had recovered, which caused an increase in
        production of manganes e ore.

        Among six major manganese mines, Assmang released their settlement of accounts for 6 mont hs but
        did not mention the quantity of manganese produced by them in t hat period. Accordingly, it is unable to
        grasp a whole picture in the world production of manganese ore but the total quantity of manganese ore
        produced by 5 mines in the first quarter of 2010 is estimated to be 3,200,000 tonnes, having increased
        by 94.6% as compared to that of 1,640,000 tonnes in the same quarter of 2009.

        Reflecting the Lehman shock emerged in autumn of 2008, the world economy in January to March
        quarter of 2009 shrunk to a s erious extent and, consequently, the price of medium grade manganese
        ore for China in that quarter had fallen t o a level of US D 5.50 t o US D 5.60 per Mn 1% CIF China, which
        was an edge line to be payable for production cost. In view of this aspect, major manganese mines
        decided to reduce their production (supply) of manganese ore and endeavored to take back a balance
        on supply and demand of manganese ore. Accordingly, an extent to reduc e their production of
        manganese ore was considerable.

        The unit price of manganes e ore for shipments in January to March quarter of 2010 had been on a
        basic tone to rise. China imported manganese ore on a scale of 2,831,000 tonnes in the first quarter of
        2010, having doubled in comparison with that of 1, 016, 000 tonnes in the same quarter of 2009, and it is
        anticipated that China will import manganese o re on a scale of 10. 00 million tonnes per annum in 2010,
        having exceeded largely that of 9.61 million tonnes imported by China in the preceding year of 2009.

        Reflecting this movement in the demand for manganese ore from China, major manganese mines had
        risen their price of manganese ore for China once in 1 to 2 months since January of 2010. As a matter
        of fact, the price of medium grade manganese ore for shipment to China in June has risen to US D 8.70
        per Mn 1% CIF in comparison with that of US D 6.50 for January shipment.

        For a reference, the recent quantities of manganese ore stocked at main discharging ports of China
        were informed as at Lianyuan port: 100, 000 tonnes, at Zhanjiang port: 130,000 tonnes, at Fangcheng
        port: 270,000 tonnes, at Qinzhou port: 680,000 tonnes, at Tianjin port: 720,000 tonnes, at Beihai port:
        200,000 tonnes and Total: 2,100,000 tonnes, corresponding to the scale imported by China for 2
        months.

        The scales of manganese ore produced by major mines in January to March quarter of 2010 were in the
        direction t o recover. However, in comparison wit h the scales of manganese ore produced by major
        mines in 2008, BHP Billiton has recovered by 100% but Comilog (Eramet ) has caught up on 93% and
        Vale on 67% respectively.

        (Sourced from TE X Report Limited)

        Ryan’ s Note s Weekly
        Ryan’s Notes, 31/05/10

        US bulk ferroalloy prices holding

        There were not any significant changes in US bulk ferroalloy prices, which sellers took as a good sign
        last week. Suppliers are worried that a flood of alloy imports c ould exert further downward pressure on
        prices and force some suppliers to sell quickly.

        European ferrosilicon pric es continued to soften and were down to €1,330-1,345 per mt.
        Silicomanganes e was also cheaper at €1,150. Sellers reported that major European mills started
        looking for their third-quarter requirements with better than expected ton nage.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          44
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        DLA‘s next sale of high-carbon ferromanganese will be June 8. Instead of monthly, all future DLA
        ferromanganese sales will be six times per year on the second Tuesday of every other calendar month.

        Chinese bulk ferroalloy prices were slightly weaker on falling demand, though supplies were limited as
        some smelters chose not to sell in anticipation of higher power prices. Smelters are refusing to pay
        higher manganese ore prices, and some ore suppliers are even finding it difficult to roll over May
        quotes. ―A few small smelters bought high -grade ore but most refused after seeing the price,‖ one
        producer explained.

        And, there is no short age of manganese ore in China. For the first four mont hs of 2010, imports were
        3,957,954.8 mt vs. 1,729,182.8 mt in the same 2009 period. Major suppliers in the first four months of
        2010 (2009 in parentheses): Australia, 1,139, 123. 5 mt (592,309.2 mt); South Africa, 959,438.7 mt
        (274,785.7 mt); Gabon, 476,796.1 mt (111, 142. 2 mt); Brazil, 407,784.7 mt (185, 747. 1 mt); Myanmar,
        297,552.6 mt (144,426.5 mt); and Malaysia, 205,898 mt (116,290.3 mt).

        OM Holdings complet ed its deal by buy 26% of the Ntsimbintle Mining for A$64-million; Ntsimbintle
        holds a 50. 1% interest in the Tshipi Kalahari manganese project. Ntsimbintle and Pal linghurst Co-
        Investors hope to start development of the project in late 2010, and plan to be producing up to 2 -million
        mtpy of ore by the end of the third quarter of 2011.

        Ryan’ s Note s Weekly
        Ryan’s Notes, 24/05/10

        US FeSi and SiMn prices lower; US imports of bulk ferroalloys up sharply

        The positive economic signs in the US were quickly overwhelmed by the euro problems last week. And,
        those fears were immediately transferred to the bulk ferroalloy market. In the US, ferrosilicon was
        reportedly booked as low as 93¢, delivered, for Chinese mat erial for significant quantities, with smaller
        quantities booked around 95¢. A large quantity of highpurity
        ferrosilicon was sold at slightly more than a $1, much lower than expected considering FerroVen‘s force
        majeure.

        Silicomanganes e tags tumbled to below 64¢, while even small quantities of medium -carbon
        ferromanganese were sold at below $1.40 per lb. European silicomanganese was sold at €1,170 per
        mt. ―Europe is no longer an attraction for manganese alloys and all the excess material is now headed
        to the US,‖ a seller explained.

        Chinese bulk ferroalloy prices were basically unchanged last week. While ferrosilicon tags were softer
        at the beginning of the week, the slide might stop in the near future.

        China‘s central government is expected to announce that it will strictly enforce the differential electricity
        rates on the ferroalloy industry. According t o sources, the summer favorable rates set by local
        governments will be abolished on June 1 and the punitive charges that are especially designed for the
        ferroalloy industry will be doubled. These actions could lead to an
        increase of $60-70 per mt in the production costs for ferrosilicon. As a result, some smelters are already
        holding back their offers for shipments in June due to the uncertainty.

        China exported 154,173 mt of ferrosilicon in the first three mont hs of 2010 vs. 96,249 mt in the same
        2009. In the first quarter of 2010, Japan received 67,227 mt (2009: 22,155 mt); Sout h Korea, 43,100 mt
        (30,985 mt); Taiwan, 10,445 mt (11,964 mt); Iran, 5,185 mt (1,550 mt); Thailand, 4,477 mt (2,222 mt);
        Turkey, 4,035 mt (188 mt); and India, 3,670 mt (2,340 mt). Exports were 66,926 mt in March alone vs.
        31,817 mt in March 2009.

        Eramet Marietta has no immediate plans to lift its partial force majeure on refined manganese
        shipments in the foreseeable fut ure des pite earlier statements that it would be gone by the end of May.
        The company, however, may further reduce the restrictions. Eramet Marietta doesn‘t want to lift the
        force majeure until it is confident that the rebuilt high-carbon ferromanganese furnace can operate
        without any problems. A second furnace that is being converted to silicomanganese will not be


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          45
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        operational until the end of the month and the company has not done any work on the furnace that
        ―blew up‖.

        The US imported 70, 980. 3 mt of silicomanganese in the first quarter of 2010 and 28, 059 mt in March vs.
        38,433.1 mt and 3,166.2 mt, respectively, in the same 2009 period. The major suppliers in the first
        quarter of 2010 (same 2009 period in parentheses) were: South Africa, 38, 674 mt (18,412.7 mt);
        Norway, 10,807.6 mt; Australia, 8,652.6 mt (5,064. 9 mt); Georgia, 4,552.5 mt (3,999 mt); Mexico, 3,000
        mt; (1,588 mt); Saudi Arabia, 2,054.2 mt (4,190.6 mt); and Spain, 1,588.3 mt.

        US imports of 55-80% ferrosilicon were 37,796.6 mt in the first quarter of 2010 and 15, 087. 2 mt in
        March vs. 17,053. 1 mt and 1, 119.6 mt, res pectively, in the same 2009 period. Major suppliers in the first
        quarter of 2010 (same 2009 period in parenthes es) were: Russia, 25,510.4 mt (6,519 mt); Venezuela,
        4,500 mt (4, 100 mt); China, 4,384. 6 mt (3,603.9 mt); and Canada, 2,752.7 mt.

        The US imported 38,948.3 mt of high -carbon ferromanganese in the first quarter of 2010 and 12,829.7
        mt in March vs. 27, 626. 9 mt and 5,681.3 mt, respectively, in the same 2009 periods. The major
        suppliers in the first quarter of 2010 (same 2009 period in parentheses) were: South A frica, 24,068.9 mt
        (26,090.5 mt); Ukraine, 8,196. 8 mt; France, 4,726.6 mt; and Zambia, 494.7 mt.

        US imports of medium-c arbon ferromanganese were 22, 152.1 mt in the first quarter of 2010 and
        7,294.8 mt in March vs. 7,836.4 mt and 723.1 mt, res pectively, in the same 2009 periods. The major
        suppliers in the first quarter of 2010 (same 2009 period in parentheses ) were: Norway, 9,600 mt; South
        Africa, 5,819.5 mt (7,382.5 mt); Korea, 3,700 mt; and Mexico, 2,594.5 mt.

        The US imported 13, 949. 8 mt of low-carbon ferromanganese in the first quart er of 2010 and 5,543.3 mt
        in March vs. 3,321. 7 mt and 278.5 mt, respectively, in the same 2009 periods. The major suppliers in
        the first quart er of 2010 (same 2009 period in parentheses ) were: China, 6,186.2 mt (616.6 mt); Mexico,
        3,750 mt; Norway, 2,090.9 mt and Korea, 1,700 mt (1,700 mt).

        Manganese ore prices moved up in China as other large, high-grade ore importers raised their tags.
        However, other sellers kept their prices slightly lower than the market leader in an attempt to gain
        market share. ―It‘s the nature of today‘s business,‖ one importer said. ―The highest price seller is a
        target for the rest of us.‖


                                                                                     STEEL NEWS                                                                         back to index

        CISA predicts rebound in Chinese domestic steel prices
        Steel Guru, 22/06/10

        Chinese steel price which has been declining for almost two months is expected to rise. But it is seen
        that spot steel price in last week maintained stable on the basis of the steel price before the Dragon
        Boat Festival, although the wait and watch attitude of the market is still strong.

        Chinese Iron & Steel Association is also opportunistic about the future of steel market as it is believed
        that there is no more space for Chinese steel price to fall. In their opinion rebound and fluctuation stage
        of steel price is coming.

        Since June, Chinese steel price is still falling, but much more slowly. On one hand, China will continue
        to enjoy the steady and rapid economic development, and the demand of steel will also keep growing;
        on the other hand, material price such as iron ore price is still high, so steel market fluctuatio n will be
        unavoidable.

        According to the analysis of CISA, first, steel export is gradually going up, which will alleviat e the
        domestic supply and demand contradiction; second, international steel price is still at the highest level,
        although Chinese domestic steel price is declining; third, the high price of materials like iron ore will help
        steel price to rebound too. All these advantages will accelerate the rebound process.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          46
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        E ver since the mid April, Chinese steel price has been declining and fallen into the adjusting stage. Mr
        Luo Bingsheng, the deputy director of Chines e Iron & Steel Association once said that some steel mills
        might be pushed to loss money and cut production due to the rising production cost in the future. Now it
        seems that he could be wrong in the former prediction.

        Global steel output 1.6% higher in May
        Metal-Pages, 21/06/10

        World crude steel production totalled 124 million tonnes in May - a 1.6% increase on the previous
        month and 29.1% higher than May 2009 in the 66 countries report ing to world steel association
        (worldsteel).

        China‘s crude steel production came in at 56.1 million tonnes - an increase of 20.7% compared with
        May last year.

        Elsewhere in Asia, Japan produced 9.7 million tonnes - up 50.2% on the same month in 2009, whil e
        South Korea‘s output increased 28% to 5.2 million tonnes.

        In the E uropean Union, Germany produced 4.1 million tonnes an inc rease of 87.7%, Italy‘s output ran to
        2.5 million tonnes - 42% higher and Spanish production ran to 1.6 million tonnes - 24.9% more than in
        May 2009.

        Turkey produced 2.5 million tonnes of crude steel last mont h - an 18.8% increase over May last year.

        Across the Atlantic Ocean, United States producers churned out 7.2 million tonnes - a 73.8% increase,
        while Brazilian production was 50.8% up at 2.9 million tonnes.

        World crude steel production in May was 2.6% higher than May 2008 before the global economic
        downturn intervened in the closing months of that year.

        While China, South Korea and Turkey showed increased crude steel producti on in May 2010 compared
        with the same month in 2008, the US, Italy, Spain and Japan are not yet back to pre-crisis production
        levels.

        The world crude steel capacity utilisation ratio of the 66 countries in May 2010 slipped to 82% from
        83.4% in April 2010 but ros e 15% from May last year.

        Global steel output in the first five months of the year is 29.8% up on the same period last year at 586
        million tonnes.

        Steel consumption across the world will increase 10.7% to 1.24 billion tonnes this year and by 5.3% to a
        historic high of 1.31 billion tonnes in 2011, worldsteel forecast in April.

        Japan May liquid steel production hits 19-month peak
        Metal-Pages, 18/06/10

        Japan's liquid steel production surged more than 50% in May, year-on-year, to 9.73 million tonnes, the
        highest level since October 2008, on strong exports to other Asian countries.

        The Japan Iron and Steel Federation said production climbed more than 8% from April this year.

        The news belied worries that falling prices and big destocking of steel prod ucts in Asia, particularly in
        China, may hit Japanese steel makers ' exports and production.

        Asia's steel prices have been weakening since April amid economic tight ening moves in China,
        uncertainty about the E uropean mark et and worries about a double dip in the world economy, with
        OECD indicators pointing to a slowdown in economic growt h.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          47
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        Japanese steel makers such as Nippon Steel, the world's second-biggest producer, and No.6 JFE
        Holdings now derive almost half of their steel revenue from exports as domes tic demand has slumped.

        Doe s China really mean busine ss thi s time?
        Metal Bulletin, 18/06/10

        The Chinese steel sector is braced for Beijing's wrath after the State Council unveiled unusually specific
        punitive measures for steelmakers and provincial governments that fail to toe the party line.

        China has been t rying for years to rein in steel overcapacity and pus h for consolidation but the June 17
        statement by the State Council — which rather wonderfully refers to the policy directions as its
        "opinions" — shows that the government finally means business, Chinese market participants told MB.

        "We have found more specific measures and targets and also related punishments on those who fail to
        realise [the targets] in the stipulated period," said a major steel t rader in Shanghai.

        Among other punitive action promised, steel mills that fail to dismantle obsolete capacity by given
        deadlines will bring down a regulatory freez e on the entire district: No other project will be able to move
        forward with government approvals nor secure release of state land.

        Local authorities that "take the initiative" to grant preferential tax regimes to steelmakers will also be
        taken to task, said the State Council, signalling that Beijing is keen to break the complicity between
        steelmakers looking to expand and local authorities seeking higher ec onomic growth: a partnership t hat
        has proven a stumbling block to previous attempts at eradicating outdat ed steel capacity.

        In anot her nod to other condoned industry practices, Beijing promis es to root out any steel projects that
        start construction while waiting for approval or before all approvals have been received, as well as the
        tendency of local authorities to give approvals for areas outside of their remit.

        This will go hand-in-hand with its decision not to approve any new steel expansion project until end -
        2011.

        In the hail of stern warnings and promised punishment however, is the usual ambitious -sounding regime
        of inspections to conduct, and this is where Beijing may run out of steam.

        It wants to inspect all steel capacity added since 2005 for any irregularities, environmental code
        violations and land misuse — a daunting task in a sector that has grown several times over in the last
        six years.

        Tellingly, it has indicated no timetable for the endeavour.

        Put next to this, its 2015 target is almost modest: To have China's 10 largest steelmakers own 60% of
        the country 's capacity, up from 44% in 2009.

        Meanwhile, those watching closely for signs of an export tax rebate reduction would have found it in the
        State Council's statement, although it did not reveal any details, exporters in China told MB.

        For many in the market, the confirmation of intent had been expected as at least one major steelmaker
        has received a government notice to say that export tax rebate adjustments will be revealed soon and
        will take effect from July 15.

        There were no rebat e change details in the notice, however.

        "Western countries are trying to save more and consume less aft er the financial crisis, so exports woul d
        be not be a good way to support the Chinese economy in the long term. The export rebate reduction is
        in line with the strategy of economic structural fine -tune," said a market participant.

        Along wit h the sense that Beijing means business this time around is the feeling that it's about time.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          48
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        "I wish Beijing would really take effective measures this time," said a steel mill official.

        ArcelorMittal will increase output in '10
        Metal Bulletin, 16/06/10

        ArcelorMittal plans to increase production in 2010 in the face of poor demand and volatile prices in
        Europe and North America, the company told journalists at a press briefing in Luxembourg on 2010.

        The company produc ed 73. 2 million tonnes in 2009, down significantly from the 103.3 million tonnes it
        produced the year before. Once again, it was the world‘s largest steelmaker.

        ―2009 was the worst year in the history of the organisation,‖ said executive vp of ArcelorMittal‘s long
        carbon Europe division Gerhard Renz. ―We hope it will stay that way.‖

        ―It is possible we will reach 90-100 million tonnes in 2010,‖ he predicted.

        While demand in Europe remains poor, demand in the rest of the world, particularly China, is rising, the
        world‘s largest steelmaker said.

        ―We need t o be cautious in E urope and in the US markets,‖ a company spokesman said. ―[But] in
        general there is a recovery.‖

        ―The macro trend is still positive, and innovation keeps on going, ‖ she continued, saying that stocks
        have now worked their way through the supply chain, although many buyers are still extremely cautious.

        ―Volatility is now higher so we have to be very flexible,‖ she said. ―Volatility is something we have to
        handle.‖

        ThyssenKrupp, Vale to Open World's Most Expensi ve Steel Mill
        Dow Jones, 16/06/10

        Germany's ThyssenKrupp Steel (TKA. XE) and Brazilian miner Vale (VALE, VALE5.BR) on Friday will
        open Brazil's first new blast-furnace steelworks in 25 years, said to be the world's most expensive after
        delays and cost overruns inflat ed the original budget by 75%.

        The 5.2 billion-euro ThyssenKrupp CSA Siderurgica do Atlantico on Sepetiba Bay in Rio de Janeiro
        state is Brazil's biggest private-sector investment in 15 years, promising to bring competitive returns for
        both partners but only after initial start-up expens e is recovered.

        CSA, 73.13% owned by Germany 's biggest steelmaker, will produce 5 million metric tons a year of steel
        slabs for rolling into finished products at ThyssenKrupp works in the U.S. and Germany, allowing the
        steelmaker to further int egrate its production chain and alleviate rising costs.

        Vale, the world's biggest iron ore produc er, will gain a captive market for its ore, free from maritime
        freights.

        The project also appeases Brazilian President Luiz Inacio Lula da Silva's desire for Vale to invest more
        in steelmaking in Brazil, creating new jobs and speeding the country 's industrial development.

        CSA's birth was not an easy delivery. "The project was part of a movement several years ago to shift
        the hot end of steelmaking from developed to emerging nations including Brazil, India and Russia," said
        Marco Polo de Mello Lopes, President of the B razilian Steel Institute, or IABr.

        Global steelmakers including ThyssenKrupp decided to shift new crude steelmaking projects to nations
        abundant in iron ore, and with more room for building and logistics than in their countries of origin, Mello
        Lopes said.

        Delays to CSA arose on soaring equipment and construction costs and a trained labor shortage as
        commodities boomed before the global economic crisis in 2008, according to Nomura Securities '


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          49
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        London-based analyst Gavin Wood. That was the year CSA was originally expected to start production
        on a 3 billion-euro budget.

        Political hurdles also hurt when CSA "imported" droves of Chinese workers to assemble a turnkey coke
        plant supplied by a Chines e firm. Violent clashes with local fishermen in Sepetiba Bay, who claimed fish
        had been driven away, complicated an already tricky environmental licensing problem.

        "CSA is the world's most expensive steelworks, with an investment per ton of slab capacity of more than
        $1,000," said a source close to the project who preferred not to be named.

        Costs were revised upward several times. Vale, which originally held 10% of CSA, upped its stake to
        26.87% in mid-2009 in a move to "speed up the project and get it finished," Vale President Roger
        Agnelli told reporters at the time.

        "ThyssenKrupp was suffering cost overruns on CSA, which the market looked upon as a cash drain on
        the company," Wood said. "Vale upping its stake gave the market confidence on the project."

        CSA also allowed V ale to meet Lula's demands "at a lower risk investment than in a greenfield project,"
        the analyst said.

        Including CSA, Vale is involved in new projects designed to produce 18.5 million tons a year of steel in
        Brazil, equivalent to about 43% of the country's total crude steel production as of 2009.

        In the longer term, Brazil is still one of the world's cheapest steel slab producers despite a relatively
        strong local currency and heavy tax burden, said SLW Corretora analyst Pedro Galdi.

        "It also helps reduc e Vale's dependence on sales to China, which accounted for a massive 30% of its
        total revenues in first-quarter 2010," Galdi added.

        In Asian markets, Vale is at a permanent disadvantage to its Australian competitors due to higher freight
        costs.

        "CSA is expensive as it's such a comprehensive project, together wit h port, rail facilities and power
        generation, but this gives scope for pot ential expansion," Wood said.

        "Once the capex cost is offs et, it should make ThyssenKrupp more competitive, allowing them to
        become a lower-cost producer over the next two years. This could give a substantial boost to their
        profit," Wood concluded.

        Mittal close to securing land for 12 mln tpy steel plant
        Metal-Pages, 15/06/10

        Ormo village, some 8 km from Petarwar in B okaro district, in the eastern Indian state of Jharkhand, has
        agreed to sell its land to ArcelorMittal for a new steel complex.

        ArcelorMittal has been nursing a plan for years to set up a new 12 -million tpy plant in the state and has
        been prepared to spend INR 500 billion ($10.74 billion) on the project, but it had not been able to get
        any land on which to build the plant.

        The ice has finally been broken and A rcelorMittal is looking for some 1,000-1,200 acres to set up the
        first 3 million tpy phase of the plant. The company has been holding a series of meetings with villagers
        for the past four months, trying to get them to agree to sell their land.

        At one of the meetings, the company offered a rat e of INR 500,000 ($10,746 ) per acre and employment
        to one eligible person per nuclear family, in line with the rehabilitation and resettlement (R& R) policy
        provisions of the Jharkhand government.

        "The employment will be given within three years of commercial production. Immediat ely after the land
        is registered, the family will be paid INR5, 000 per month as annuity, till the time the eligible person gets


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          50
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        the job. Anyone not willing to take up the job will continue to get a payment of INR5,000 per month, for
        30 years, as per the R& R policy," an official said.

        The company, which had earlier selected Khunti-Gumla as the project site, decided to shift to B okaro
        following opposition from the villagers - and has found Bokaro villagers apparently more willing to part
        with their land for the project.

        Chinese steel output hits record high of 56m tonne s
        Metal Bulletin, 11/06/10

        China's crude steel output has risen again in May to set a record high for the third month running, in
        response to demand booked in the peak of the market rally in April.

        Output rose 1.3% from April to 56.14 million tonnes in May, up 21% year -on-year, according to the
        national statistics bureau.

        However, May daily crude steel output slipped to 1.81 million tonnes, from 1.85 million tonnes in April.

        Steel production has peaked and is expected to start falling in June, said market participants.

        Chinese domestic steel prices started to weaken in May ahead of the summer lull, when demand
        traditionally slides and many mills choose to schedule maintenance exercises.

        Beijing's moves to tight en credit and rein in the property sector has also dampened general demand for
        steel.

        "Traders dare not book a lot of steel given Beijing's meas ures to regulate the housing market and falling
        demand from the cars and home appliances sectors. Steel mills are not expected to produce so much
        under such circumstances," said a trader in Zhejiang.

        Smaller mills are already cutting output while major steelmakers including Baosteel, Anshan Steel and
        Wuhan Steel have cut their list prices in response to falling demand.

        "Though steelmakers have cut ex works prices, we would not take as much cargo as before since their
        prices remain higher than spot sales prices. It is easy to make a loss if mark et prices continue to drop in
        June," said a trader in Shanghai.

        China's crude steel output has achieved rec ord highs for four out of five months so far this year, taking
        total output to nearly 269 million tonnes, up 24% year -on-year, according to the bureau.

        ArcelorMittal pressured to build Egypt stee l plant
        Metal-Pages, 11/06/10

        Egypt's Industrial Development Authority has given ArcelorMittal, the world's largest steelmaker an
        August deadline to begin building work on a steel plant near the Red Sea or lose its licence, The
        Economic Times report ed, citing an official of the organis ation.

        ArcelorMittal was granted a licence in 2008 to build a $340 million plant to produce 1.6 million tonne of
        steel using DRI technology and another 1.6 million tonnes of billets, but the producer held the project
        back because of the of the global economic downturn.

        While ArcelorMittal says Egypt remains an important market for future investment, the company will
        have to show its commitment by starting construction work to retain the licence, the official report edly
        said.

        "The consumption of steel in Egypt has been impacted by the recent financial crisis. Demand is now
        recovering and we plan to start discussions with the Egyptian government about the project imminently,"
        ArcelorMittal said in an emailed statement.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          51
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Steel rebar demand has remained relatively resilient in Egypt because of the need for housing and
        government infrastructure spending, analysts say.

        Chinese steel majors under pressure to cut output
        Metal Bulletin, 09/06/10

        Yesterday 's comments from Baosteel chairman Xu Lejiang on the prospect of Chinese production cuts
        in the third quarter were not a revelation.

        Many marginal steelmakers were already under pressure after sharp price declines in t he last month.
        Production cuts or the hastening of maintenance at smaller swing producers were already well -known.

        But Xu Lejiang's remarks about weak demand and rising costs underline the difficulties in t he months
        ahead for the Chinese steel industry.

        "It's very likely that China's steel giants will also start mai ntenance from mid-July. They can't afford to
        bear high costs during the period when real steel demand normally slows down," said a trader in
        Zhejiang province.

        Most of the produc ers that are already implementing production cuts are smaller steelmakers, often
        making long products. The spot price for rebar in eastern China has fallen around 16% from its 2010
        peak, more sharply than other products, according to Met al Bulletin's archive.

        On May 24, 19 steelmakers in Hebei province brought forward maintenance work.

        These included Liuzhou Steel, Shaoguan Steel, Maanshan Steel, Jigang Minyuan Steel, Feida Steel,
        Tonggang, Shougang and Baotou Steel, according to trading sources.

        Beijing's efforts to rein in the property market have succeeded in cooling real -estate sentiment, but this
        has shaken commodities mark ets and sowed worries about steel demand in the second half of the year.

        China's bigger steel mills are likely to feel a great er impact if, as Baosteel's Xu mentioned yesterday,
        the downturn hits key flat product mark ets like cars and home appliances.

        "The reason why the bigger steel producers have not started to cut output is that traders and stockists
        are now shouldering the losses," said a trader in Shanghai.

        "If spot market prices continue to fall, steelmakers will have to refund traders in the end. In this case,
        producers would end up taking a loss and will have no choice but to cut production," he added.

        The bigger state-owned produc ers are also reluctant to reduce output because they operate according
        to production plans approved by local governments.

        But as demand weakens and profits thin, their problems are compounded by rising raw materials costs.

        One of the challenges posed by the emerging price system is that iron ore prices are set retrospec tively
        against average spot market rates from the previous period, when steel demand may have been much
        better.

        So steel producers are likely to be hit with higher prices for the third quart er, just as they struggle to
        maintain existing margins.

        Baosteel last week cut list prices by 500-1, 300 yuan ($73-190) per tonne for most of its steel products,
        the first reduction this year.

        Larger mills may be able to rely on existing stockpiles of ore to mitigate miners' efforts to win higher
        prices — but not for long.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          52
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        "When the low-priced iron ore is used up, their production costs are going to be much higher," said a
        third market participant in Hebei province.

        Xu said that some smaller steelmakers are likely to default on iron ore contracts in the third quart er if
        the contract price ends up being higher than the spot market.

        Domestic steel prices are lower again this week in China, with rebar trading at 3,810 -4,070 yuan per
        tonne in Shanghai, down around 30 yuan from last Friday, and hot rolled coil at 4,160-4,170 yuan, down
        around 10-20 yuan.

        "Commercial 5-12mm hot rolled coil prices are under great pressure to drop below 4,100 yuan and are
        going to slip to 3,900-3,800 yuan on weak demand," said a major trader in Shanghai.

        ArcelorMittal mulls Q3 furnace s shutdown
        Metal-Pages, 04/06/10

        ArcelorMittal, the world‘s leading steelmaker has confirmed reports that it is considering shutting down
        as many as three blast furnaces in the third quart er due to expected slower demand.

        ―In Europe the third quart er is characterised by lower demand due t o summer vacation shut downs,‖ the
        company said in an emailed statement.

        The steel producer made no mention of current money and share market volatility linked to euro -zone
        debt worries that has been attributed to a fall off in buying of ferro-alloys and ot her metals.

        "In order to be prepared Arc elorMittal is technically in a position to reduce its production by stopping up
        to three blast furnaces in Q3. No decision if and where and when has been taken.‖

        Metals traders and analysts continue to underline that while steel production remains well above where
        it was a year ago, buying has switched to hand to mouth patterns as steel producers eye the markets
        and other global events such as tensions bet ween North and South Korea.

        World steel output increa ses 35,7% y-on-y in April
        Engineering News, 21/ 05/10

        Global steel production in April was 35,7% higher than a year ago, but 0,4% lower than Marc h, at 121,6 -
        million tons, the Worldsteel Association reported this week.

        It said in a statement on Thursday that despite the month -on-month decline in out put, April's global
        crude steel capacity use ratio rose for the fourth mont h in a row.

        Steel production in South Africa, Africa's biggest steel producer, showed an increase of 15,3% for A pril
        2010, to 6,9-million tons compared with April 2009's 5,98-million tons, while the A frican steel market
        also showed a slight increase of 8,9% in production from 13,75-million tons in the comparative period.

        Meanwhile, the world's biggest steel producer, China, showed a 27% increase in its April 2010 steel
        production from to 55, 4-million tons, the highest monthly amount of steel that the country has ever
        produced.

        Among ot her Asian steelmakers, Japan produced nine-million tons of crude steel in April, 3,8% less
        than the previous month, but 57% higher than the same month last year.

        Meanwhile, output from S outh K orea was up by 0,7% from March to 4, 8-million, which was also 23%
        higher than the production for April last year.

        The US produced 6,8-million tons of crude steel in April, 4,2% lower than last mont h, but 79% higher
        than in April 2009.




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          53
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        Further, Brazilian crude steel production fell 4,3% month-on-month to 2,7-million tons for April 2010,
        however, production was still 57% higher than the comparable period last year.

        In Europe, Germany's crude steel production was 3,9-million tons, which was 3,4% less than in March,
        but more than double the level produced a year earlier.

        Italy also showed a spike in production up 58% to 2,4-million tons and Spain was up 36% from the
        previous year to 1,6-million tons.

        Crude steel production in all European countries totalled 15, 4-million tons, 64% up year-on-year, but
        0,8% lower than March.


                                                                                OHES & SCIENCE                                                                          back to index


                                                                                              EMM                                                                       back to index

        Chinese manganese market firm despite slow demand
        Metal-Pages, 21/06/10

        The Chinese electrolytic manganese market has stabilised since last week 's Dragon B oat Festival, with
        prices supported by relatively high production costs despite soft consumer demand and thin business.

        Current mainstream prices for 99.7% min manganese flakes are at RMB14,600-14,800/tonne basis ex
        works, unchanged as compared to one week ago.

        ―Downstream demand is far from satis factory, however, we are sticking to offers of RMB14,700/tonne
        due to firm production costs, and transaction prices are generally around RMB14,600/tonne. Many
        plants have stopped production, so we are unwilling to offload material below the c urrent price level , ‖
        said a Hunan based produc er.

        However, another market participant doesn‘t rule out the possibility that prices would go down slightly,
        in view of sluggish demand from both domestic and overseas consumers.

        ―Foreign buyers claimed that some deals have been concluded below $2,700/tonne basis DDU in
        warehouse Rotterdam for flake, and higher prices can find little acceptance,‖ he comment ed.

        Manganese prices are expected to hold stable if demand sticks to the status quo, and no big price
        fluctuations are on the horizon in July and August, which is traditionally a slack season for manganese
        business, industry sources said.

        Mn flake rises $50 on shutdowns in China
        Metal Bulletin, 16/06/10

        Manganese flake prices rose by $50 per tonne on Wednesday, their first upward move since April 14,
        after seven consecutive drops prompted Chinese factories to shut down, traders told MB.

        Material traded at $2,680-2,750 per tonne compared with $2,630-2,750 per tonne, where prices had
        held since June 4, when they fell by $2 5 at the high end of the range and $20 at the low end.

        "Apparently, 50-70% of production has been shut down, so there's obviously been a reaction in China
        [to the falling prices]," a trader told MB.

        Chinese producers have been claiming since May that they would cut output if prices fell too clos e to
        the cost of production,

        Traders had been concerned about a possible stock build over the E uropean summer, but stocks are
        now understood to be quite low, they told MB.

  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          54
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        "The price seems to be settling; I think it's going up a little in China, despit e the depressed mark et in
        Europe. There's not much stock at the plants," a second trader told MB.

        Most concluded business was reported at around $2,720 -2,750 per t onne, but prices were also being
        discussed at around $2,630 and above $2, 750, according to traders.

        "Perhaps there isn't as much material as people first thought," the first trader added.

        Manganese flake started to fall on May 7, when material fell to $2,870-2,950 per tonne from $2,875-
        2,975, where prices had stayed since April 16.

        European manganese flake stable despite smugglers
        Metal-Pages, 15/06/10

        The European spot manganese flake mark et has stabilised in the past week after slipping earlier this
        month, as production cuts in China, the key world s upplier, have offset cheaper offers for Chinese
        manganese smuggled out of the country to avoid an expensive export tax, dealers told Metal -Pages on
        Tuesday.

        European spot prices are at $2,700-2,750 a tonne basis in-warehouse Rotterdam, depending on
        delivery terms, with most offers at the upper end of that range.

        ―Cheaper, smuggled manganes e flake from China is having a big impact on the market, although any
        short term weakness seen through the seasonal slowdown should be balanced on production cuts in
        China,‖ a dealer said.

        Dealers said Chinese producers had been much more disciplined in their furnace melt rates in the past
        couple of years amid the world economic recession, and with any recovery fragile against austerity cuts,
        particularly in countries in the West, such production discipline will be needed in the coming months.

        Some Chinese exporters have been exporting manganese flake via Vietnam and Hong Kong to avoid
        paying a rec ently-imposed 20% export tax on strat egic materials, and t hat material is being offered at
        some $2,600 a tonne in Rotterdam.

        However, producers in China, which makes about 95% of total annual world supply of manganese flake,
        have cut their production t o only a third of their capacities due to a recent increase in domestic
        electricity costs, as well as environmental inspections.

        ―European manganese prices have been getting a bit firmer this week and while the third quarter is
        traditionally slower in terms of business activity, tighter production levels should support the market
        through that,‖ another dealer said.

        The bulk of total world manganese production is used in alloy form in steel for use mostly in
        construction.

        American Manganese Inc. to Receive Contribution Through NRC -IRAP
        Mark etwire, 15/ 06/10

        Larry W. Reaugh, President and Chief Executive Officer of Canadian mining developer, American
        Manganese Inc. (CA:AMY 0.20, 0.00, 0.00% ) (P INK S HEE TS: AMY ZF) ("American Manganese" or the
        "Company"), is pleased to announce it has signed a t hird Contribution A greement with the Nat ional
        Research Council of Canada Industrial Research Assistance Program (NRC -IRAP) to continue the
        successful development of a hydrometallurgical process to extract and rec over high purity manganese
        from lower grade domestic resourc es within North America. The success of that program has led to the
        development of a proprietary process that will be the subject of an application for patent protection.
        Extensive studies and tests were conducted by the U.S. Bureau of Mines (U.S.B.M.) over more than
        forty years. The recent developments have resulted in a treatment strategy that involves an innovative



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          55
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        application of modern commercial process equipment. The res ult will be a more robust, complete flow
        sheet with reduc ed operating costs to recover manganes e from lowe r grade resources.

        Kemetco Research Inc's ("Kemetco") report for the work completed in the initial phase to May 15, 2010
        is in progress.

        In addition to financial support, NRC-IRAP will provide a range of both technical and business oriented
        advis ory services.

        The Company is working with Kemetco to continue the development of a novel hydrometallurgical
        process which will yield high purity manganese metal and/or manganese dioxide at low cost from North
        American known resources.

        Chinese manganese offers firm but demand is weak
        Metal-Pages, 14/06/10

        Chinese electrolytic manganese prices have been firm at RMB 14,400-14,500/tonne ex works during the
        past few days aft er a brief hike driven by higher electricity costs. However, physical demand is reported
        to remain sluggish.

        The increase in electricity tariffs and environmental inspections have resulted in higher production
        costs, causing many producers to close their smelters. It‘s reported that as much as 70% of capacity is
        idled now, except for production in Chongqing that is unaffected due to stable power rates in the region.

        ―Selling conditions are far from good in the domestic market, and some trading houses have been
        shipping material to Hong Kong and Vietnam to dodge the heavy ex port tax. Their offers are generally
        $200/tonne lower than the current regular export offers which are at $2,750/tonne FOB,‖ a producer told
        Metal-Pages.

        A trade source said: ―Foreign customers are inclined to buy hand -to-mouth material on spot basis due
        to the spread of the European debt crisis. Manganese flakes are fetching $2, 700 -2,750/tonne DDU in
        warehouse Rotterdam, while manganese briquettes are selling muc h better at $2,400/tonne DDU. ‖

        Most market players agree that the manganese market is not likely to firm up in the short term due to
        sluggish consumer demand.

        Mn flake suffers seventh fall in a month
        Metal Bulletin, 04/06/10

        Manganese flake fell for the sevent h time in a month on Friday, losing up to $25 per tonne amid weak
        demand and continued concerns about the impact of smuggling.

        Material traded at $2, 630-2,750 per tonne, down from $2,650-2, 775 per tonne, where prices fell on June
        2.

        ―It‘s the stuff coming through Vietnam that‘s really bringing the price down; the smuggled material. It
        creates a two-tier market,‖ a trader told MB.

        ―Demand is weak and if it stays weak, the price will continue to go down gradually,‖ he said.

        Higher electricity prices in China failed to support the minor metal, despite factories saying they will not
        produce when prices are so close to the cost of production, according to traders.

        ―The price is getting weaker in Europe, but in China there‘s an increase in electricity prices, despite the
        heavy rain in the south,‖ a second trader told MB.

        ―In the rainy season, the electricity prices should in theory go down, but on the contrary, the government
        has raised the electricity cost and factories are refusing to produc e, saying they can‘t survive at this
        level, ‖ he added.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          56
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        The market began to fall on May 7, when material fell to $2,87 0-2,950 per tonne from $2,875-2,975,
        where prices had stayed since April 16.

        But a third trader predicted prices will soon find t heir low point and bounce back, saying all the signs
        showed a recovery is likely.

        "Electricity‘s going up and I know a couple of producers who don‘t want to compet e at this level.
        Manganese flake might go down $30 -40 more, but in the long run I think it will flatten out and go up,‖ the
        trader told MB.

        Chinese manganese market lacklustre on dull demand amid stainless cutbacks
        Metal-Pages, 03/06/10

        The Chinese electrolytic manganese market has been quiet this week with manganese flake prices
        unchanged at RMB 14,200-14,400/tonne basis ex works amid weaker consumer demand.

        Demand from overseas markets is also weakening as the falling domestic prices have encouraged
        buyers to adopt a wait and see attitude.

        Domestic stainless mills, the main downstream users of manganese metal, have been cutting their
        output and have suspended purchasing of feedstocks. As much as 40% of manganes e ca pacity is
        estimated by industry sources to have been shut due to poor mark et conditions and most producers are
        downbeat about the market prospect and expect prices to fall further.

        However, a Hunan based producer reported that the government will launch a new round of inspections
        on producers‘ environmental facilities and all unqualified players will fac e shutdown.

        Export prices are nominally at $2,700 -2,800/tonne basis FOB and sources reported t hat virtually no
        material is being shipped from China as the 20% export duty is too expensive.

        ―European consumers will be abs ent for summer holidays in July and A ugust so we hope t hat
        restocking will pick up in June but we doubt this will come true as buying enquiries from overs eas
        customers are still sporadic at this moment,‖ said an export trader.

        China exported 12,631 tonnes of unwrought manganese metal, mostly flakes and lumps, in A pril,
        compared with 12,348 tonnes in March. Exports in the first four mont hs totaled 40,011 tonnes versus
        32,894 tonnes in the same mont hs of 2009, according to latest Customs data, which do not include
        exports via Viet nam.

        The latter is significant because anecdotal evidence is that material smuggled across the Viet namese
        border in avoidance of the 20% export duty has been making its way into overseas markets and in
        Europe undercutting prices of mat erial legitimately cleared through Chinese customs.

        American Manganese moves step closer to public offering
        Metal-Pages, 01/06/10

        Specialty metals producer Americ an Manganese Inc. said it had received clearance to file its final short
        form prospectus ahead of a planned public offering.

        The Vancouver-based company said it aims to raise about C$882,522 (US$841,328) through the sale
        of 2,757,880 shares at a price of about $0.32 per share.

        The proceeds from the public offering will be used for advancing the pre-feasibility study of the
        company 's Arizona Manganese project, including diamond drilling and metallurgical testing.

        American Manganes e is aiming to become a low cost produc er of electrolytic manganes e from its
        Arizona Manganese project.



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          57
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        Last month, the company said that research and development firm Kemetco Research Inc. had
        completed the development of a conc eptual process for extraction and recovery of high purity
        manganese metal from the Arizona deposit.

        The company said it had agreed to Kemetco‘s recommendation to seek patent protection for this
        proprietary technology.

        China currently controls electrolytic manganes e production by supplying and producing about 97% of
        the world‘s needs, which is equivelent to about 2.6 billion pounds per year, according to American
        Manganese.

        Chinese manganese market in downturn on weak demand, cheaper material via Vietnam
        Metal-Pages, 26/05/10

        The Chinese electrolytic manganese market has weakened further this week, with mainstream prices
        for manganese flakes slipping to RMB14, 400 -14,600/tonne ex works.

        Market participants say that there is still room for prices to edge lower and many producers have
        stopped making offers due to the chaotic market conditions.

        Some producers have opted to close out their inventories and then stop production due to their
        downbeat sentiments and there is already an increasing number of producer shutdowns in some
        regions.

        ―As prices have been falling for three weeks in a row, the transaction prices have dropped below the
        production costs for the majority of producers. There is limited room for prices to go down in terms of
        the current mark et prices,‘ said a market source.

        The export market remains nominal thanks to the availability of cheaper material shipped from Vietnam,
        traders said.

        ―Some E uropean buyers have said that they cannot accept any offers higher than $2,700/tonne basis
        CIF Rotterdam and they would like to buy at even lower numbers,‘ said an export trader.

        Another trader reported that offers of $2,700/tonne basis DDU in warehouse Rotterdam are available
        due to cheaper material shipped via Vietnam.

        ―Legal exports including the 20% export duty are simply not workable now,‖ she said.

        Vietnam borders with China‘s Guangxi province, which is among the top three producing regions for the
        metal.


                                                                                              EMD                                                                       back to index

        Delta EMD finally finds buyer for its Australian residue site
        Business Day, 09/06/10

        JSE-listed Delta EMD, a global supplier of electrolytic manganese dioxide with its manufacturing plant in
        Nelspruit, yesterday announced it had finally found a buy er for its Australian residue site.

        Delta, which had been battling to sell the struggling plant, said it would sell it to Port Waratah Coal
        Services for A12m.

        This comes after the company shut its manufacturing plant in Australia three years ago.

        Delta CEO Praveen Baijnath said the decision to sell the operation and dispose of the residue plant was
        an ―economic ‖ one and would result in the tightening of supply in the market and raise prices.


  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          58
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        ―Delt a EMD‘s facilities in Nelspruit are the company‘s key strategic manufacturing operations,‖ Mr
        Baijnath said.

        Having one manufacturing plant was ―better in terms of cos t and competitiveness‖.

        Overall, Delta EMD‘s net value of its Australian assets for last year was R34,7m. ―Delta EMD‘s
        underlying performance remains strong, not withstanding the global economic crisis and reduced global
        demand for electrolytic manganese dioxide,‖ chairman Todd Atkinson said.

        ―The group‘s strengthened management team successfully managed the EMD business in more difficult
        market conditions, initiated significant operational improvements and charted a strat egic course for
        further improvement and development of the business.‖

        Mr Atkinson said Delta EMD expected the global EMD mark et to strengthen during the year as global
        economic conditions improve.

        ―Nonetheless, we do not expect to sell sufficient volumes during 2010 to fully use our plan t, and
        consequently will continue to suffer from poor overhead recoveries.

        ―Pricing pressure is likely to continue while market demand is relatively soft, and our price
        competitiveness will be partly shaped by foreign exchange rates and the rand, which remains relatively
        strong,‖ he said.

        Delta EMD said it remained confident of its competitive advantages — favourable ore supply
        arrangements and a relatively low conversion cost — and expected improved mark et demand and
        participation in new market segments to provide attractive medium - term prospects.

        Meanwhile, the new owners of the Australian site, Port Waratah , would adhere to strict environmental
        licences and deeds.

        The environmental licence regulates the use of the site and requires rehabilitation of the site when it is
        no longer being used.

        The site‘s environmental assessment was concluded successfully and a site audit confirmed the site
        was suitable for commercial and industrial use without further remediation or rehabilitation.

        Carbon Nanotube Foams and Nanoscale Manganese Oxide Make Improved Supercapacitor
        Electrode s Say Navy Scienti sts
        Before it ’s News, 25/05/10

        The Unit ed States Navy (Washington, DC) garnered U.S. Patent 7,724,500 for a composite made of
        nanoscale manganese oxide (MnO2) on an ultraporous carbon nanoarchitecture which can be used to
        manufacture improved supercapacitor electrodes.

        Inventors Jeffrey W. Long, Anne E. Fischer and Debra R. Rolison say the composite is a porous carbon
        structure with a surface and pores and a coating of MnO2 on the carbon surface, in which the coating
        does not complet ely fill or obstruct a majority of the pores. The coating is formed by self-limiting
        electroless deposition.

        Electrochemical capacitors (also denoted as supercapacitors or ultracapacitors) are a class of energy -
        storage materials that offer significant promis e in bridging the performance gap bet ween the hig h
        energy density of batteries and the high power density derived from dielectric capacitors. Energy
        storage in an electrochemical capacitor is accomplished by two principal mechanisms: double -layer
        capacitance and pseudocapacitance.

        Nanostructured MnO2-c arbon nanoarchitecture hybrids can be designed as electrode structures for
        high-energy-density electrochemical capacitors that retain high power density. Homogeneous, ultrathin
        coatings of nanoscale MnO2 can be incorporat ed within porous, high -surface-area carbon substrates



  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          59
The IMnI does not acc ept any responsibility for information, views or opini ons c ontained i n the articles reprinted i n Manganes e Matters, whic h are solel y thos e of the publications credited.
        (such as carbon nanofoams) via electroless deposition from aqueous permanganate under controlled
        pH conditions.

        The resulting hybrid structures exhibit enhanced gravimetric, volumetric, and area-normalized
        capacitance when electrochemically cycled in aqueous electrolytes. This design can be extended to
        other mesoporous and macroporous carbon forms possessing a continuous pore net work.

        The performanc e limitations of MnO2 for electrochemical capacitors can be addressed wit h a hybrid
        electrode design, by incorporating discrete nanoscale coatings or deposits of MnO2 ont o porous, high -
        surface-area carbon structures.

        In such a configuration, long-range electronic conduction is facilitated through the carbon backbone and
        solid-state transport distances for ions through the MnO2 phase can be minimized by maintaining a
        nanoscopic carbon parallel.MnO2.parallel. electrolyte interface throughout the macroscopic porous
        electrode. Such a design c an be realized using various types of porous carbon substrates including but
        not limited to aerogels/nanofoams, templated mesoporous carbon, and nanotube/nanofiber assemblies.

        The synthesis and electrochemical characterization of MnO2 -carbon composites has been reported and
        primarily focused on incorporating nanoscale MnO2 deposits onto carbon nanotubes using a variety of
        approaches including simple physical mixing of the components, chemical deposition using such
        precursors as KMnO4, and electrochemical deposition.

        In these cases, the incorporation of MnO2 improves the capacitance of the electrode structures that
        contain the MnO2-modified carbon nanotubes; however, the overall specific capacitance for the
        composite structures is typically limited to <200 F g-1, even for electrodes with high weight loadings of
        MnO2.
        Cont ribut ed by Alton Parrish (Editor)




  Manganese Matters n° 10 (Issued June 22, 2010)                                                                                                                                          60
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