Manganese is an important industrial metal. More than 90 percent of global consumption is closely tied to the steel and construction sectors, and China is a major consumer of the commodity.
The metal is also used in the most common form of lithium-ion batteries, ones using nickel-manganese-cobalt (NMC) cathodes.
Despite its solid demand base, the manganese price has been a victim of volatility in the past few years. COVID-19 lockdowns, extreme weather events and Russia’s war in Ukraine slowed manganese production, leading to price surges. However, more recently China’s slower economic recovery has tamped down on steel demand, placing downward pressure on manganese prices.
Read on for a closer look at manganese supply and demand dynamics, an overview of why the metal could be a compelling investment choice in the coming years, and manganese mining companies and junior stocks to consider.
As mentioned, the steel sector accounts for most manganese demand, using it as a deoxidizing and desulfurizing additive and as an alloy constituent. Among other things, manganese can improve the strength, toughness and stiffness of steel. In turn, the steel sector is a key driver of the manganese price.
The electric vehicle (EV) battery industry is the second largest consumer of manganese today, and many market watchers believe that demand from this sector could be set to increase in the future.
Manganese dioxide has long been used as a depolarizer in alkaline batteries, but this is not the manganese battery market that is now the most interesting. Attention is being drawn to lithium-ion battery chemistries that require manganese — such as lithium-manganese oxide batteries and nickel-manganese-cobalt oxide batteries.
In these batteries, electrolytic manganese dioxide is used as a cathode material. Many investors who believe that battery sector demand for manganese will increase are optimistic that lithium-ion batteries that require manganese will become more common in the future.
While the steel and EV battery industries are the top consumers of manganese, other uses of manganese exist as well, with the metal turning up in chemicals and more.
As the manganese story has picked up speed in recent years with its necessity to popular electric vehicle cathodes, more publicly traded companies are focused on manganese, offering investors more choices for exposure to the metal.
While a number of large companies are involved in manganese production, many of them are private. These are some of the major mining companies that produce manganese:
Investors interested in smaller manganese companies may want to look at junior manganese stocks trading on Canadian, American and Australian exchanges. These are some of the options available to investors:
This is an updated version of an article originally published by the Investing News Network in 2017.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: ChemX Materials and RecycLiCo Battery Materials are clients of the Investing News Network. This article is not paid-for content.
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