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The European benchmark ferrochrome price for the fourth quarter of 2023 is $1.53/lb, 1.32% up on the third quarter of 2023, Merafe Resources advised its shareholders on Monday.
The main focus of the business of the Johannesburg Stock Exchange-listed Merafe is the 20.5% participation by wholly owned subsidiary, Merafe Ferrochrome and Mining, in the earnings before taxes, depreciation and amortisation of the Glencore-Merafe venture, in which Glencore has a 79.5% participation.
The third-quarter ferrochrome price of $1.51/lb was 12.2% down on the $1.72/lb of the second quarter. Ferrochrome is a key ingredient in stainless steel, a recyclable corrosion-resistant product.
China continues to dominate stainless steel production, accounting for almost 60% of global stainless steel output, and 65% of global ferrochrome demand.
South Africa holds about 70% of the world's total reserves of chrome, which is the key ingredient of ferrochrome, a corrosion-resistant alloy of chrome and iron.
As reported by Mining Weekly earlier this year, ferrochrome production from the Glencore Merafe Chrome Venture for the six months ended June 30 was 185 000 t, a decrease of about 9% compared with the 203 000 t reported for the six months ended June 30, 2022.
As the baseline for beneficiation in South Africa’s mature chrome value chain, ferrochrome is energy intensive and poor electricity supply from South Africa’s State power utility Eskom has curtailed the local ferrochrome business and boosted the exportation of raw chrome to particularly China, which has gained major ferrochrome market share as a result.
This has lost jobs in South Africa owing to
ferrochrome exports creating 200%-plus more jobs than chrome ore exports.