Kumba Iron Ore on 2021 guidance and outlook for 2022 to 2024

Themba Mkhwanazi, Chief Executive of Kumba has provided an update on the Company’s full year 2021 guidance and the outlook on production for 2022 to 2024 and C1 unit costs for 2022. He said: “Kumba continues to prioritise the safety, health and well-being of our workforce and communities. Over 70% of our workforce have been fully vaccinated and we are supporting the vaccination effort amongst employee family members and our local communities.

“Following the completion of the annual maintenance programme in October, operational performance has ramped up to planned levels. Production and sales are expected to remain in line with our full year 2021 guidance of c.40.5Mt and c.39.5Mt, respectively.

“Across many industries including mining, we continue to see the repercussions of the Covid-19 pandemic, including supply chain disruptions and rising input costs. Consequently, Sishen’s unit cost is at the upper end of our guidance of R430 and R440/t, while Kolomela’s unit cost has increased to between R320 and R330/t (from R305 to R315/t). The Kumba C1 unit cost guidance for production of US$40/t is unchanged.

“Our production performance in 2021 is expected to be 7% higher than that in 2020, demonstrating our operational resilience and ability to manage through external challenges. We continue to focus on cost performance and ensuring that we are well set up to deliver on our priorities for 2022.

Production guidance for 2022 and 2023 has been revised to 39-41Mt (from 41.5-42.5Mt). In 2022, Transnet’s stacker reclaimer refurbishment programme at the Saldanha Port will impact port capacity and, consequently, Kumba’s value chain.

In 2023, production is expected to be impacted by the tie-in of the Sishen ultra-high-dense-media separation plant. In line with our strategy, the UHDMS technology will extend the Sishen life-of-mine and further improve the quality and carbon reduction properties of our product in the steelmaking process, thereby optimising the value of our product.”

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