South32 evaluating Colombian nickel complex on price drops

South32 revealed in its quarterly production and earnings report this week that it will be placing its Cerro Matoso nickel operation in Colombia under a strategic review following a reduction in prices paired with a production shortfall.

The complex’s payable nickel production in 2H23 was 18.3 million tonnes, down 10%, despite the miner’s outlook of 40.5Mt full-year while eyeing higher grades for the half year ending this June.

Manganese and moly were also weaker than expected for the operator.

South32 boss Graham Kerr told Financial Review his company that, as others in the ferronickel space opt for idling operations, a review of Cerro Matoso is reportedly in order.

“In an industry where people thought there was going to be a shortage, there is going to be an oversupply. And I think that has ramifications for us,” Kerr told the outlet at the World Economic Forum in Davos.

“We’re probably not in the position where we have to shut up shop. But I think we have to think about how we potentially do the business differently.”

Because most of Indonesia’s nickel output is heading to China, South32 is evaluating ways to concentrate its sales into the U.S. market, he added.

“Colombia obviously has a good relationship with the U.S. So, one of the things we’ll look at exploring is, can we also look to converting some of our product from ferronickel into an MHP (mixed hydroxide precipitate) matte that might also go into the batteries in the US?” Kerr noted to FR.

South32 did not confirm any concrete decisions in its report: “Along with the group-wide cost review, we have commenced a strategic review of Cerro Matoso to evaluate options to enhance the operation’s competitive position,” officials said.

Sources: and S32 ASX: Nickel glut prompts rethink for South32’s Colombian mine (

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