Glencore Alloys and Merafe have informed employees at Rustenburg Smelter, their South African joint venture, that a restructuring program is underway. It is estimated that 665 jobs could be lost in the restructuring of this smelter’s operations.
The ferrochrome smelter is grappling with a slew of issues. In a statement, the companies cited unsustainable electricity tariffs and interruptions, cross subsidies and real cost inflation as the reasons for the smelter’s floundering ferrochrome production volumes. Moreover, overseas competitors have begun undercutting the Rustenburg Smelter’s prices, the companies indicated.
The statement also said that significant investments have been made to augment operations and make Rustenburg more competitive, but it has suffered material financial losses, which it doesn’t expect will cease any time soon.