Platts reported that OM Holdings produced 94,392 tonnes of manganese from its Bootu Creek mine in Australia's Northern Territory in the three months ended March 31st 2009, down by 34% YoY from the 143,465 tonnes produced in the quarter before.

The reduced output was in line with its plans to reduce full year production to 500,000 tonnes for the first half of 2009, in line with a drop in global demand. Output from its 100% owned Qinzhou Smelter in Guangxi produced 10,173 tonnes of high carbon ferromanganese during the March quarter, up by 2% QoQ from 9,951 tonnes produced in the December quarter.

Mr Peter Toth CEO of OMH said that "The current manganese ore prices make a large percentage of current manganese ore production short term cash negative and long term uneconomic, particularly in the low grade domestic and high cost marginal seaborne segments."

Despite the outlook, OMH is pushing ahead with the construction of its new AUD 12.6 million rejects re treatment plant at Bootu Creek, which will be internally funded from operating cash flow. The commissioning of this facility, scheduled for December 2009, will enable production to reach an annualized rate of 900,000 tonnes by 2010.

(Sourced from www.platts.com)