Transalloys warns of permanent closure of South Africa’s last manganese smelter
Manganese ferroalloys producer Transalloys has fully stopped its ferroalloys production in Mpumalanga on July 1, with no indication of when operations may resume.
The company highlights that the suspension of smelting places about 600 permanent jobs and an estimated 7 000 downstream livelihoods at risk as the company prepares to phase out its plant.
Section 189 consultations and a collective retrenchment agreement have already been concluded.
CEO Konstantin Sadovnik says the company had no option but to shut down its furnaces after years of mounting financial losses, while negotiations over electricity tariffs with State-owned power utility Eskom and government continue.
“It has been a tough uphill battle. Our business has been losing substantial amounts of money for the past three and a half years.
“We have done everything possible to reduce costs, conserve cash, raise awareness and engage government, Eskom and the regulators to find and implement a sustainable electricity tariff solution.
“Now, effectively, our destiny is in the hands of Eskom, the National Energy Regulator of South Africa and the Department of Electricity and Energy – they are to determine whether Transalloys lives or dies. Further procrastination will amount to a death sentence,” Sadovnik says.
He warns that unless a sustainable solution is agreed by July 31 and implemented with urgency thereafter, the company is unlikely to survive winter.
“Transalloys has now reached the point where continuing to operate would simply accelerate our own collapse. We have exhausted every option available to us operationally while engaging Eskom, government and the regulators, and there are still significant points of differences between us and them.
“We have now had to stop our production entirely. Unless there is an urgent intervention before the end of July, South Africa will lose its last manganese smelter, thousands of livelihoods and decades of industrial capability. Once those furnaces go cold permanently, which is a near-term reality, there is no turning back,” Sadovnik concludes.