Eramet extends fall on Gabon manganese export ban

Shares of French miner Eramet fell for a second day after Gabon said it would prohibit the export of manganese ore starting in 2029 in a bid to create a homegrown processing industry.

Manganese accounted for 60% of Eramet’s 2024 revenue of 3.4 billion euros (C$5.3 billion). Paris-based Eramet produced 5.5 million tonnes of ore last year, which the company says made it the world’s biggest producer of the mineral. Its Comilog unit is the oldest and largest operator of manganese mines in Gabon.

Eramet declined 0.3% to 49 euros Tuesday in Paris. On Monday, the day after Gabon announced the export ban, the stock dropped 4.9%. The company’s market capitalization is about 1.4 billion euros.

Gabon is the world’s second-largest manganese producer, having churned out 4.6 million tonnes of ore in 2023, according to United States Geological Service data. It shipped the ore to Europe, China and the U.S.

South Africa, the top global producer, holds an estimated 70% of manganese resources, the USGS says.

Local transformation

Gabon’s goal is to “transform our resources locally, strengthen national skills and maximize added value for our economy,” the Ministry of Mines said in a statement published Sunday. Companies will have three years “to prepare for this irreversible transformation,” the ministry added.

Now led by President Brice Clotaire Oligui Nguema, Gabon has been taking steps to strengthen its industrial base. Other African countries, such as Guinea with bauxite and Mali and Tanzania with gold, have also implemented policies to retain more value from mineral wealth by restricting raw material exports and encouraging domestic refining and processing.

In a statement issued Monday, Eramet said it “takes note” of the Gabonese government’s intention to ban raw manganese exports from Jan. 1, 2029.

Eramet “acknowledges the government’s ambition and, as the main co-shareholder in Comilog, will continue to work with the authorities in a spirit of constructive partnership and mutual respect,” according to the statement. The company will “remain attentive to this policy shift and will work collaboratively to identify further opportunities for it to contribute to Gabon’s economic development in the long term, whilst maintaining the sustainability of its mining and metals operations.”

Strategic role

Setrag, another Eramet subsidiary in Gabon, operates the country’s only railroad. Eramet said it “aims to safeguard the strategic role of Comilog and Setrag in being an internationally significant supplier of manganese to the global steel industry — and the 10,460 Gabonese jobs they sustain.”

South32 (ASX: S32), which extracts manganese in Australia’s Northern Territory and in South Africa’s Kalahari Basin, is another major producer of the mineral. South32 shares rose 0.3% to A$2.95 Tuesday.