Eramet (ERMAF)

What Moves the Stock

1. 01Manganese ore and alloy prices - directly tied to Chinese steel production and inventory levels, with CRU manganese ore index as key benchmark
2. 02Nickel prices (LME) and battery-grade nickel premiums - Indonesian supply dynamics and EV adoption rates drive volatility
3. 03Chinese steel PMI and crude steel output - China consumes 90%+ of seaborne manganese, making steel production the primary demand driver
4. 04New Caledonia operational stability - SLN has history of losses and restructuring; any production disruptions or cost overruns materially impact results
5. 05Battery materials project execution - lithium extraction in Argentina (Centenario) and nickel sulfate capacity ramp critical for growth narrative
6. 06Manganese division (~45-50% of revenue): Moanda mine in Gabon producing 6+ million tonnes annually, plus ferroalloy plants in Norway and France serving steelmakers
7. 07Nickel division (~30-35% of revenue): SLN operations in New Caledonia producing ferronickel, targeting battery-grade nickel sulfate production
8. 08Mineral Sands division (~15-20% of revenue): Grande Côte operation in Senegal producing ilmenite and zircon for pigment and ceramics markets

ERMAF Chart

My Notes

• value/turnaround - Deeply cyclical commodity play trading at 0.6x sales and 1.6x book despite negative earnings.
• Rising rates negatively impact Eramet through multiple channels: (1) higher financing costs on €1.4B+ net debt position (Debt/Equity 2.37x)…
• Watch on earnings: CRU Manganese Ore Index (37% Mn, FOB Port Elizabeth) - primary revenue driver for largest division, LME Nickel 3-month price and Class 1 vs. Class 2 premium spread, China crude steel production (monthly, NBS data) and steel PMI.