[miningmx.com] — MERAFE Resources said on Wednesday its production of ferrochrome was
21% lower during the first quarter of 2012 than the comparative period, mainly due to power buy-back
deals with Eskom.
The group’s attributable production from its joint venture with Xstrata was down from 82,000 tonnes to
65,000 t for the period.
Merafe has shut seven furnaces following requests from Eskom to support the power utility’s maintenance
programmes. The furnaces would be shut until end-May, during which time Merafe would do its own
maintenance work.
Furthermore, ferrochrome producers achieved a 17% increase in the European benchmark ferrochrome
price from $1.15 per pound (lb) in the first quarter of 2012, to $1.35/lb in the second quarter, driven by
reduced supply in the market.
“Margins, however, remain under pressure as a result of continued higher mining
inflation, increased standing charges and a relatively strong rand compared to
the US dollar,” the company said.
