Is GAA trying to close Felman Productions by eliminating the US duty, part 2

Eramet left nothing on the table in attacking the Ukrainian producers and I mean NOTHING.

Eramet said the high P was a mostly fiction. Mills have been able to blend the high P silicomanganese with standard-grade, especially since they obtain more manganese per ton than they do from other silicomanganese sources. In the first six months of 2018, Ukrainian Customs declaration showed they exported 22,216 tons of grade B silicomanganese or 14.4% of their total exports. Customs export declarations showed that only 23.5% of Ukrainian exports in interim 2018 had P levels of 0.5% or higher whereas almost half consisted of silicomanganese with a P content of 0.35% or lower.

In addition, official US import statistics confirm that imports from Georgia—the largest US source of silicomanganese, consisted predominantly of high P material, not grade B.

Also the Ukraine has plenty of unused capacity. Furthermore, NFP and ZPF are “controlled” by Igor Kolomoisky and Gennadiy Bogolyubov, the presumptive owner of Felman Production and Trading, the other US silicomanganese producer and the exporter of Georgian silicomanganese. Therefore, Felman can easily boost its US sales without certification or testing and has an extensive sales presence in the US market. Eramet noted the website of Georgian American Alloys—affiliate of the producers in Ukraine, the owner of Felman Productions smelter, and the importer of Georgian material, advertises two grades of Georgian silicomanganese, standard-grade B and high grade, high P material which has a Mn content of about 72% and a P content of 0.20 to 0.35% P. NFP and ZFP can also double process the silicomanganese to make standard spec material.

Eramet said the Ukrainian producers” artfully dodged asking any questions about corporate affiliations during the hearings. “Clearly, lifting this rock would not yield anything that would support revoking the order on silicomanganese from Ukraine.

As for Stakhanov, Eramet claims the plant is operating and is expected to reach full capacity by the end of this year. Even though it is outside of government control, the plant is still in the Ukraine and will be a major exporter.

With the US as the premium market that’s where the Ukrainian silicomanganese will end up. And, even if spot fixed-priced sales were relatively small, they would have a major negative influence over the pricing indexes.

In probably the most damning statement, Eramet hinted that the owners, Igor Kolomoisky and Gennadiy Bogolyubov, could benefit by the closure of Felman Productions if those sales could be replaced by lower-cost imports from Ukraine.

“Indeed as the now bankrupt and closed Warren Steel’s former employees can attest, the Ukrainian oligarchs and the US business partner that direct global production, shipments exports and prices of their various affiliates have a record of caring more about enriching themselves that protecting US production assets such as Warren Steel and Felman Production. Put another way, Felman is at risk if the order on imports from Ukraine is revoked, and the other domestic producer, Eramet Marietta is even more concerned.

This is probably why the USW representing workers at Felman and Eramet are lobbying to keep the duties.

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Bob the Miner
Bob the Miner

Thanks a lot for this passionating thread ! Just a remark on Consolidated Minerals: if I am not mistaken, the company now belongs entirely to the chinese and EMM producerTMI(Ningxia Tianyuan Manganese Industry). The only agreement CML has with Grizal (or Privat, to put it simply) is a 600kt/year offtake agreement for Ghana ore and a 10 year duration. Mn ore from Australia’s Woodie-Woodie mine goes solely to China.