JOHANNESBURG (miningweekly.com) – The new Inflation Reduction Act (IRA) in the US has improved the business case for producing manganese in that country.

Well-established South African manganese mining group South32 has confirmed the opportunity for its manganese deposit in the US to supply battery-grade manganese into the growing US electric vehicle (EV) supply chain.

The US deposits of the Sydney-, Johannesburg- and London-listed South32 are part of its Hermosa land package in Arizona.

The key piece of IRA legislation will reportedly provide tax credits for US battery manufacturers who have a 40% share of their critical minerals coming from the US or countries with which it has free trade agreements. That rises every year until 2027, when the threshold will be 80%, terms described as providing a strong platform for South32’s push into North America.

“IRA is clearly supporting the use of EVs in the US around a 2030 timing. There is a desire for the development of domestic supply chains, of which South32 has two out of Taylor and Clark.

“If we go for manganese, which is the second one coming out after Clark, we’re looking at manganese in the context of batteries for cars. It’s about producing a high-purity battery sulphate anhydride,” South32 CEO Graham Kerr said in response to Mining Weekly during a media conference after the company posted one of its highest profits to date with half-year earnings of $1.36-billion, underpinned by production growth of 12%. Increased exposure to the metals critical to a low-carbon future, and continued focus on cost efficiencies enabled the company to pay an ordinary dividend of $224-million.

Manganese for batteries is seen as having the potential to rise from a tiny proportion of the end user demand to as much as 30% by 2030 and there are a number of manganese producers looking to produce high-purity manganese sulphate.

South Africa's manganese mines are mainly in the Kalahari basin of the Northern Cape, which hosts most of the world’s known top-quality manganese resources

Moreover, South Africa’s Manganese Metal Company, situated in Mbombela, is reportedly the world’s only non-China-based producer of high-grade electrolytic manganese metal (EMM) and the world’s largest refinery of 99.9% (selenium-free) EMM, with 95% of production exported.

Three key products are EMM, electrolytic manganese dioxide (EMD) and manganese sulphate monohydrate (MSM), with EMM being 97% pure metal, EMD containing 63% manganese in chemical form, and MSM containing 32% manganese, also in chemical form, with its pink crystals containing one molecule of water.

If given the go-ahead, South32's Clark operation would have its own decline access and be dewatered ahead of the lower-lying Taylor zinc-lead-silver underground mine, on which a decision will be taken this year, ahead of a decision on Clark.

Zinc, which is also on the US critical minerals list, is positioned to increase in demand significantly with the growth of wind turbines, and silver is in demand for solar panels.