The operator of South Africa\u2019s last remaining manganese smelter said it may have to cut as many as 600 jobs as high power prices undermine the viability of its business.<\/p>\n\n\n\n
Transalloys (Pty) Ltd. issued retrenchment notices to staff and is running only two of its five furnaces, the company, based in the coal-rich town of eMalahleni, east of Johannesburg, said in a statement Monday. <\/p>\n\n\n\n
Surging South African power prices and competition from China have hit local processors of ferrochrome and manganese, both of which are key ingredients in steelmaking. <\/p>\n\n\n\n
The country has about three-quarters of the world\u2019s identified manganese-ore reserves.\u00a0<\/p>\n\n\n\n
\u201cWe are competing against international smelters whose electricity costs are roughly half of ours,\u201d Transalloys Chief Executive Officer Konstantin Sadovnik said in the statement. \u201cThat gap makes sustained operation impossible.\u201d <\/p>\n\n\n\n
Glencore\u2019s ferrochrome unit said earlier this month it would shutter two operations. <\/p>\n\n\n\n
In November, labour union Solidarity said Samancor Chrome Ltd. may cut almost 2,500 jobs as it curtails operations. \u00a0<\/p>\n\n\n\n
South Africa\u2019s government has acknowledged the pressures on the ferrochrome industry, with the cabinet approving a plan in June to negotiate new electricity prices and introduce potential controls and taxes on chrome-ore exports. <\/p>\n\n\n\n
But the reforms have yet to be finalised, and the export levy is unpopular among miners.<\/p>\n\n\n\n
Manganese processing faces \u201charsher conditions than the ferrochrome sector,\u201d given it is more energy-intensive, Sadovnik said. <\/p>\n\n\n\n
Without certainty on power pricing, Transalloys \u201cwill have no option but to proceed with restructuring around February,\u201d he said.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"
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