On March 18, Dannemora Mineral AB filed for bankruptcy with Sweden’s Uppsala District Court. The company has been in reorganization since May 13, 2014. However, due to the uncertainty over the company’s future, the previously steady sales of the company’s products have been affected by disruptions due to the build-up of inventory in the customer chain, which was caused by customers evaluating alternative suppliers. Anticipating a reduction in supply volumes and, consequently, an increase in the inventory of ore in the second quarter, the company’s board of directors has decided that there is no basis for continuing with a reorganization.
The company’s problems originate from 2012, when the completed concentration plant was unable to process the mine’s ore as expected. By means of fewer investments and streamlining, the company was able to increase the mass recovery of finished products from an initial 30%-34% to currently approximately 40% of crushed crude ore. Expected mass recovery was 58%.
In 2014, the mine produced 1.2 million tons of ore, lump ore and fines. With its manganese content and absence of phosphorus and vanadium, the Dannemora ore has been highly rated by leading European steel companies, and constitutes a valuable ingredient for customers’ blast furnaces.
“The Dannemora mine is operational and we have developed cost-effective solutions to our well-defined technical problems. However, we have been unable to procure the necessary financing for the necessary investments within the requisite time,” said Dannemora Chairman Lennart Falk, who founded the company in 2005.
