Four concerns in manganese mining
TEHRAN (Iran News) Issues such as the import of manganese, the supply of machinery and the payment of government salaries, along with the increase in wage costs, are the four main concerns of manganese mines. These problems have faced serious problems in mining. Activists of manganese mines are demanding different support and attention from the government.
Manganese metal is one of those functional metals that are used in various industries. The specific physical and chemical characteristics of this metal have made it known as a strategic metal. About 80% of manganese consumption in the world is used in steel industry. Manganese has the property of deoxygenation and causes purity and improvement of some quality parameters in iron. One of the important reasons for the quality of iron beams and rebars produced in a unit like Isfahan iron smelter is because of the manganese used by this complex.
Mohammadreza Raghebian; The CEO of Iran Manganese Mining Company stated in an interview with the reporter of “Dunya-e-Ekhtisad” that Iran Manganese Mining Company has a 55-year history in the field of manganese extraction in the country and is currently the largest manganese miner and supplier in Iran. About 60% of the needs of Isfahan Iron Smelting Company, which is one of the largest steel production companies, is supplied by Iran Manganese Mining Company. It also provides half of the Iranian Zarand Steel Company’s needs and 40% of the manganese needs of ferroalloy industries, electric arc furnaces and ferrosilico manganese production units.
The heavy cost of extracting manganese mines in Iran
Raghebian added: Currently, the focus of Iran Manganese Mining Company’s extraction is at a depth of 290 meters underground. The extraction costs and the finished price are much higher than open pit mines. There are a limited number of open-pit manganese mines in Iran. In the world, the largest manganese mines located in African countries such as Tanzania and Namibia are open and the slope of these mines is low and facing the horizon. The slope of Iran’s manganese layer is about 85 to 88 degrees and close to vertical. This also increases the cost of extraction. He further pointed out the problems in this area: the challenges we face in manganese mining are beyond and more complicated than other mines. Due to the fact that manganese mines are underground, specialized machinery is needed. Sanctions have affected the import of mining machinery. Despite the sanctions, the cost of purchasing each device and machinery has reached many times the previous rates.
For example, to buy loaders and mechanical excavators, due to the general consumption of these types of devices, many people enter the field and overcome the sanctions. According to the guidelines, the supply of these is facilitated. In the field of supplying specialized machinery, we are facing quite a challenge and therefore we are forced to impose an increase in the cost price. CEO of Iran Manganese Mining Company said: Unfortunately, what is now a serious challenge is the lack of support from the government’s legislative body. In addition to support, monitoring and control, the government should also put prioritization on its agenda. Iran Manganese Mining Company has been active in the field of manganese mining for more than 55 years and is a public company and is accepted in the stock exchange with the symbol of Manganese. This company is the supplier of materials needed by Zob Ahan Company and expects that the government will look at this company with a supportive view and in some way support will be doubled.
Calculation of unfair government rights for underground mines
Raghebian pointed out: In the last two years, government rights were the first challenge faced by Iran Manganese Mining Company. The government fee is calculated at 5% of the selling price of manganese in the mine. Although there are many factors that increase the cost price, this 5% is also considered a heavy figure. Maybe this number is not significant for open mines, but for underground mines such as manganese, it is considered a large amount. Since Iran Manganese Mining Company is a listed company, all production and sales statistics are clearly stated, so it is clear that calculating 5% government salary is not desirable for such sales.
He emphasized: the issue of machinery entry permit is also handled for manganese mines that need special devices like other mines and companies. In general, we do not see the support and distinction expected from the government. Last year, we were obliged to appoint a market operator to support the Cummins symbol, if it was predictable for all the companies that are present in the stock market that the index will fall, and the bubble that was created in 2020 was clear in 2021. It will decrease slowly, but Iran Manganese Mining Company was required to protect the share, and despite this, a listed company that prevents the share from falling is no different from a non-listed company and does not enjoy special protections in the field of government rights and taxes.
This CEO continued: Importing manganese and ferrosilicomanganese is another challenge we are facing. To prevent the sale of raw materials in the complex, we put the construction of a ferrosilicomanganese production factory on the agenda. In the first three months of this year, more than 50,000 tons of manganese were imported from Africa and 14,000 tons of ferrosilico-manganese from India, which has made the conditions difficult for units that have domestic production. When it is possible to produce manganese and ferrosilicomanganese in the country, in order to settle these conditions, the import tariff should be increased so that the incentive for domestic production and job creation remains stable. Because currently 400 people are working directly and 2 thousand people are working indirectly in this group and we have more than 35 thousand shareholders in the group, any disruption to the type of activity of this company will affect the job security of these people. puts.
The possibility of increasing definite reserves to more than 6.5 million tons
He reminded: There are not many large and integrated manganese mines in the country and more than 200 thousand tons of manganese are produced annually in Iran, of which 100 thousand tons belong to Iran Manganese Mining Company. According to the prospect of producing 55 million tons of steel by 2025, the need for manganese will increase. It can be fruitful to support domestic miners and create incentives to restrict imports and increase import tariffs.
Raghebian said: Considering that there is a need for manganese in the country, but there is no export in this sector. The confirmed and identified reserves in our company’s mines are estimated at 5.5 million tons and it is expected that during future exploration operations, the amount of definite reserves will increase to more than 6.5 million tons, and in this case, manganese mines alone will meet the country’s needs up to It will pay off in the next 25 years. Now, due to the problem of power outages that we have two days a week, and due to the increase in salaries and wages, a significant part of the total cost is spent on salaries and wages, which has been accompanied by an unprecedented increase of 57% this year. These types of cases reduce the production motivation for domestic producers, and in total, we have a production plan of 110,000 tons for the rest of this year, which will be achieved if no problems occur.
He said: In the mine exploration department, drilling and coring have been done up to a depth of 1,100 meters, which has led to the determination of a reliable reserve for the construction of a factory for the production of ferrosilicomanganese with the majority ownership of manganese mines in the Nizar industrial area, and the initial forecast For the implementation of the plan, something like 280 billion Tomans was estimated. However, due to the upcoming inflation, the capital required for this project has reached more than 400 billion tomans, and half of the project has already been completed.
The CEO of Iran Manganese Mining Company stated: Since manganese is needed in the country and the conditions of international supply and foreign policies as well as the import process are not stable, these issues will cause changes in the domestic production process. For example, Ukraine, as the second magnet producing pole, faced crisis and war in the last few months. For this reason, the government should pay attention to miners and domestic producers. The issue of import acts as an accommodation that cannot be relied upon in any way, and in order to realize the vision of 1404 and considering the heavy costs of manganese production as well as job creation, government support for manganese miners, especially those who work in the field of manganese derivatives, should be more than before. So that the tensions of foreign policies and other events do not affect domestic producers.