MELBOURNE, Feb 4 (Reuters) - Australia's South32 Ltd S32.AX said on Thursday it will write down its assets by $1.7 billion, axe hundreds of jobs, and cut global manganese supply by about a quarter as it battles what it sees as a prolonged slump in commodity prices.
The miner, spun off last year by BHP Billiton BHP.AX BLT.L , said it would reduce production at its manganese operation in South Africa, which would help it cut costs and position it well for any eventual rebound.
"We are, however, not immune to external influences and the significant change in the outlook for commodity prices is expected to result in non-cash charges of approximately $1.7 billion when we report our December 2015 half year financial results," Chief Executive Graham Kerr said in a statement.
The writedowns are mostly on its Australian manganese business and energy coal in South Africa.
South32, the 60 percent owner of the world's largest manganese business, Samancor, suspended mining at the Hotazel mines last November while it completed a review of the business.
It has now decided to resume production at Hotazel at a reduced rate of 2.9 million tonnes a year, removing about 900,000 tonnes a year from the global market "for the foreseeable future".
That will cut its costs in South African rand by about 23 percent, with about 620 jobs to go across the joint venture co-owned by Anglo American Plc AAL.L , and help it cut capital spending by about 80 percent next year.
At the same time, South32 flagged it planned to slash costs at its metallurgical coal, alumina and manganese operations in Australia and the Cerro Matoso nickel mine and smelter in Colombia, which will result in further job cuts to be announced at its results on Feb. 25.
South32 shares jumped 9 percent after the announcement to A$1.035, but the stock has still lost half its value since listing last May.