Hubei Letong Stops Manganese Flake Production Due to Losses

Hubei Letong, a Chinese manufacturer of manganese flakes, halted its production last week due to operational losses and maintenance issues with equipment, as confirmed by market sources. The company, located in Changyang County, Hubei Province, has not yet specified when it will resume operations. Before the suspension, Hubei Letong was producing between 40 to 50 tonnes daily, with an annual capacity totaling 36,000 tonnes. Adding to the challenges, supplies of manganese ore have become constrained due to local environmental inspections.

In the last two weeks, manganese flake prices have shown a slight recovery, driven by producers increasing their offers to mitigate operational losses. However, further price rises are not anticipated, as the demand for manganese alloys remains weak. The stainless steel industry, a key consumer of manganese flakes, has not rebounded as expected, even after the usual summer slowdown concluded.

Producers with their own mines experienced considerable losses when prices dropped below 12,000 yuan per tonne. As of September 18, domestic prices for 99.7% grade manganese flakes were assessed at 12,000-12,200 yuan per tonne, marking a 300-yuan increase from earlier in the month. This price recovery follows a decline during July and August, after reaching a one-year peak of 13,700-13,900 yuan per tonne in late June.