Only Lion Smelter to operate during high electricity demand season

Merafe’s attributable ferrochrome production decreased by 9% from 203kt to 185kt for the six months ended 30 June 2023. The reduction is mainly due to the planned pullback in production over the winter months.

Only the Lion smelter will be operating during this high electricity demand season of elevated power prices. The operations were also impacted, to a lesser extent, by stage 3 and 4 electricity load curtailments over the six months ended 30 June 2023.

Lydenburg smelter, Rustenburg furnace 6 and Waterval mine remain under care and maintenance for the foreseeable future.

The total unit cost of ferrochrome production increased by 17% from December 2022. The increase was driven by general inflation, higher chrome ore market cost and higher reductant costs. Reductant costs were impacted by higher market prices and inadequate local supply, which necessitated some imports of coke.

Electricity tariffs increased by 19% effective 1 April 2023. The reliability of the electricity supply continues to be a risk for the business. Logistics challenges continue with not much improvement in rail availability.

The chrome industry and Transnet Freight Rail continue to collaborate on improving rail performance. The disposal of the Boshoek mine is in its final stages and its conclusion rests largely on receipt of regulatory approvals.

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