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Unexpected Damaged Brigde may delay shipment of Ore
Transnet declares force majeure on iron ore, manganese shipments from Saldanha
South African transport operator Transnet is issuing force majeure notices to iron ore and manganese ore customers after a railway bridge was damaged near the port of Saldanha.
Manganese Ore Index 37% Mn, Fob Port Elizabeth $ per dmtu of metal contained.
All rail operation was suspended following the accident in the morning on Wednesday November 28 and will restart in two weeks, Transnet said.
“The accident has damaged the railway line network and compromised the integrity of the railway bridge, resulting in an immediate stop of rail movement along the route. Transnet is issuing force majeure letters to customers impacted by the temporary rail closure,” the operator said on Friday November 30.
The bridge requires reconstruction before safe operation can resume, it said.
Manganese market sources said the disruption will affect 150,000-200,000 tonnes of manganese ore shipments, based on average transported volumes over recent months.
Transnet did not respond to requests for comment on the extent to which manganese or iron ore volumes will be affected.
A number of manganese market sources expressed concern over the impact on shipments, warning that the situation is likely to create a backlog into January 2019.
“This will especially affect year-end shipments and will cause a backlog into 2019. Three major manganese producers are expected to be affected,” one market source told Fastmarkets.
The disruption could also offset near-term price weakness in manganese, amid some concern over the potential for traders in China to sell off stocks ahead of year end.
Fastmarkets’ 37% manganese ore index, fob Port Elizabeth stands at $5.94 per dry metric tonne unit on November 30, dmtu, down from $6.08 per dmtu on November 9.
“This could be supportive when manganese prices come under pressure, so this could be good news for traders and producers,” a trader told Fastmarkets.
“Sentiment is weak but can only go up if the bridge is out for a while,” the trader added.
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