[SMM Chromium Flash] FAPA Warns SA Ferroalloys Sector Still Faces Rapid Decline Despite Ferrochrome Tariff Relief

South Africa's ferroalloys sector remains in a state of rapid decline despite recent electricity pricing relief for the ferrochrome industry, according to Ferro-Alloy Producers Association (FAPA) chairperson Nellis Bester. He said the tariff relief, credited with enabling the restart of Glencore Merafe's Boshoek and Wonderkop smelters earlier this year, has served mainly to prevent further deterioration rather than restore conditions for renewed growth, and should be treated as a short-term measure rather than a lasting fix.

Bester attributed the sector's ongoing weakness to a combination of structural pressures: escalating electricity costs, rail and port logistics constraints, unprotected imports of finished alloy products, growing competition from lower-cost producing countries, and prolonged uncertainty over industrial policy. He said South Africa's silicon and manganese alloy operations are in a more precarious position than ferrochrome, with several smelters already suspended and others at risk of permanent closure, and warned that without decisive government and Eskom intervention within weeks, the decline would deepen and add to unemployment.

Among the fixes Bester called for are a genuinely competitive electricity tariff, import duties on finished alloy goods, and improved rail and port infrastructure to reduce reliance on costlier road transport for exports. He stressed that South Africa retains world-class mineral resources, technical expertise and installed smelting capacity, but that these advantages are being eroded by structural cost disadvantages the industry says can still be corrected through coordinated action, adding that producers are not seeking permanent protection, only a fair, competitive operating environment to preserve the sector's remaining skilled jobs.