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A C ChoksiShare Brokers Private LimitedA C Choksi Institutional Research |Initiation Report|MINING MOILApril 26, 2011Manganese Ore: Global Scenario & Future OutlookThe world output of crude steel in the calendar year 2010 increasedby 15.5% to 1,400 million tonnes. Out of that Brazil accounts for(2.3%), Russia, (4.7%), India (4.7%), China (44.3%) and Japan(7.8%). As manganese ore demand follows the demand for steelconsumption, we believe that manganese ore demand is likely to behealthy till the steel demand is robust. If we were to link the demandfor steel consumption to global growth then we should see higherconsumption of steel by growing economies of the world and with theJapanese Tsunami & nuclear disaster we see steel consumption inJapan increase in years to come.A recent TEX report in steel guru states that the total quantity ofmanganese ore produced by six major manganese mines in theworld in the calendar year 2010 saw a substantial increase of53.8% on the average compared with that in the preceding year2009. The production Manganese ore has outpaced the globalcrude steel production. 2009 saw the manganese ore miningcompanies reducing their outputs to a significant extent. So withglobal expansion in production of crude steel the miners haveincreased the output by a substantial 80% in 2010. Q4 2010 theoutput of manganese grew by 11.8% over Q4 2009. The totalquantity of manganese ore produced by six major manganese minesin 2010 is reported to be 17.1 million tonnes in 2010 a decreasefrom 18.3 million tonnes in 2008. China, the biggest producer ofsteel (44.3%) imported 11.6 million tonnes of manganese ore in thecalendar year of 2010, an increase of 20.6% comparedwith that (9.6 million tons) in the preceding year of 2009. Chinahas an inventory of 3 to 4 months quantity of manganese ore storedat wharves in discharging ports of China as of the 31st Decemberof 2010. The over supply effect may cause the manganese ore pricesto remain muted over short term. However, manganese oredemand is expected to expand in future._____________________________________________________________________________________A C Choksi Institutional Researchresearch@acchoksi.com 25