Miningweb: Power crunch forces Glencore to close two South African smelters

Key topics:Glencore to close 2 SA smelters amid soaring electricity costsRetrenchments and voluntary severance planned for 3,000 staffSA ferrochrome output falls as global rivals fill supply gap.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By William Clowes and Ana Monteiro.Glencore Plc’s ferrochrome unit in South Africa will shutter two plants and cut jobs because of soaring electricity prices, the latest blow to the country’s declining smelting industry.The Swiss commodity trader’s joint venture with Merafe Resources Ltd. has issued retrenchment notices and voluntary severance packages to employees, it said in a statement. The company plans to mothball the Boshoek and Wonderkop smelters — where operations were suspended earlier this year — at the start of 2026.South Africa is the world’s largest producer of chrome ore — a key ingredient in stainless steel — but its processing industry has been hammered by rocketing electricity prices and fierce competition from China, the top ferrochrome supplier.Glencore-Merafe has held talks with state-owned Eskom Holdings SOC Ltd. about power tariffs, but a proposal put forward by the utility only allows one of the venture’s five smelting complexes — the Lion site in Limpopo province — to keep running, the statement shows..Read more:.Miningweb: Eskom dispute could close South32 Mozam aluminium smelter, 2nd biggest in Southern Hemisphere.South Africa’s government has acknowledged the pressures on the industry. The cabinet approved a plan in June to negotiate new electricity prices and introduce potential controls and taxes on chrome-ore exports. But the reforms have yet to be finalized and the export levy is unpopular among miners.The government now has a week to come up with a workable solution for Glencore-Merafe, following which the retrenchment plan will become binding, according to the statement. The joint venture didn’t say how many jobs may be affected, but it employs almost 3,000 people in the smelting business.Samancor CutsThe country’s other major ferrochrome producer — Samancor Chrome Ltd. — said late last month that it may cut almost 2,500 jobs as it considers closing or curtailing operations because of high energy costs, according to labor union Solidarity.Glencore’s local subsidiary will see its ferrochrome output drop to about 14% of capacity once Boshoek and Wonderkop are shuttered, according to Tanisha Schultz, a senior researcher at analysis firm Project Blue. Samancor was already operating at less than a fifth of capacity before the latest measures, she said.Other nations have ramped up ferrochrome output, offsetting the reduced volumes from South Africa. New production from countries including China, Kazakhstan and Zimbabwe “has already absorbed the shortfall,” Schultz said..© 2025 Bloomberg L.P.

Miningweb: Power crunch forces Glencore to close two South African smelters

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