US steel companies are working with the Office of the US Trade Representative and members of Congress to grant a generalised system of preferences (GSP) programme that would bring duty-free benefits to manganese metal powder from South Africa so that the firms will be less reliant on imports from China, steel industry sources say.

House Ways and Means Committee member Ron Lewis has sent a letter to USTR in support of the South African GSP petition, noting that the only US producers of manganese use it for their own products and no longer sell it.

Manganese is used to harden steel and welding products and is currently subject to 14 per cent duty. Victor Mrocaka of Vincent and Elkins said that China is the only other producer of manganese in the world, but the South African powder “is more environmentally friendly than its Chinese counterpart.”

• Meanwhile in China, CITIC Resources Holdings is considering splitting its manganese operations for a separate listing at the stock market, sources reported citing the company's chairman Kwok Viem Peter.

CITIC Resources, a unit of China's state-owned conglomerate CITIC Group, formed a joint venture CITIC Dameng Mining Industries Limited with Guangxi Dameng Manganese Industry Co, Ltd in February 2006 for development and processing of manganese mines.

Its partner, Guangxi Dameng Manganese, in southern China's Guangxi autonomous region, owns the country's two largest manganese mining companies, which has manganese dioxide reserves of 120 million tons and manganese oxide reserves of 15 million tons, accounting for 22 per cent of the nation's total proven reserves.

The manganese producer has mining capacity of 890,000 tons a year, as well as Manganese sulphate production capacity of 40,000 tons annually, and it is the world's largest manganese sulphate producer and a major provider of manganese metal powders.