Kenmare lifts FY2017 production guidance as market looks positive

JOHANNESBURG (miningweekly.com) – LSE-listed Kenmare Resources on Monday adjusted its production guidance for this year to between 950 000 t and 1.05-million tonnes of ilmenite, 5% to 16% higher than production for 2016, owing to increased utilisation and recovery rates at its Moma titanium minerals mine, in Mozambique.

The miner further expects its zircon production to rise by 6% to 22% year-on-year to between 72 000 t and 83 000 t, while its rutile production is also expected to climb by 15% to 28% to between 9 000 t and 10 000 t.

The higher production outlook comes on the back of record yearly and quarterly production of ilmenite, rutile and zircon.

For the three months to December 31, the mine’s heavy mineral concentrate (HMC) production increased 55% to 474 300 t, while ilmenite output rose 35% year-on-year to 256 900 t, zircon production by 38% year-on-year to 20 000 t and rutile output by 35% year-on-year to 2 300 t.

HMC production for the year ended December 31, totalled 1.41-million tonnes, up 28% on that produced the year before.

Ilmenite production for the full year increased 18% to 903 300 t, while zircon output was up 32% to 68 200 t. Full-year rutile production was up 30% to 7 800 t.

Total shipments of finished products for the year were up 28%, setting a record of 1.02-million tonnes shipped.

Demand for ilmenite had grown strongly throughout 2016, resulting in significant price increases since the market bottomed in the second quarter, Kenmare noted.

The company said the outlook for ilmenite prices remained positive for the year ahead, supported by low product inventories throughout the value chain and higher titanium feedstock consumption, as pigment demand continued to grow in line with global gross domestic product.