SOUTH32 increased South African manganese production in the September quarter as productivity improved at its Wessels mine, although sales fell sharply after the group cut higher-cost trucking in response to market conditions.
South Africa Manganese saleable production rose 11% quarter on quarter to 588,000 tons, from 528,000 tons in the June quarter. Production was 7% higher year on year, supported by improved underground productivity at Wessels.
Sales fell 22% quarter-on-quarter to 460,000 tons and were 16% lower year on year. South32 said it reduced trucked volumes in response to market conditions, while one shipment slipped into the December quarter.
The cut comes against softer manganese market conditions, with demand closely tied to steel production in China. South African producers must also weigh manganese prices against the higher cost of moving ore by road when rail capacity is constrained.
South32 said in August that higher trucking and diesel costs had impacted earnings from its South African manganese operations despite increased sales volumes.
The company maintained South Africa Manganese production forecast at two million tons (Mt) for the 2027 financial year, while saying it would continue to monitor market conditions and optimise the use of higher-cost trucking.
The improvement formed part of a stronger quarter for South32’s manganese business overall, with production rising 14%.
Australia Manganese made the larger contribution. Saleable production rose 15% quarter on quarter to 902,000 tons as operating conditions improved after heavy rainfall in the previous quarter. Production was 6% higher year on year.
South32 maintained its Australian manganese production forecast at between 2.65 and 2.9Mt, subject to the wet season. It also progressed approvals for additional water-management infrastructure.
CEO Matt Daley said the group had made a positive start to the year, maintaining production estimates across all operations and achieving “key development milestones” at its copper and zinc growth projects.
Net cash increased by $14m to $297m during the quarter, helped by a $153m distribution from its Sierra Gorda copper investment in Chile.
Sierra Gorda payable copper-equivalent production rose 11% quarter on quarter to 22,400t as higher planned copper grades offset temporary wet-weather disruption.
South32 also spent $197m at its Hermosa zinc-lead-silver project in Arizona. Construction continued underground and on surface, with the main and ventilation shafts expected to reach the primary production level in the December quarter. All flotation cells and major electrical transformers have been installed.