South Africa
Merafe reports lower ferrochrome output but guides for higher interim earnings on pricing and cost control
Merafe Resources reported lower ferrochrome production for the period on 27 July while simultaneously guiding for higher interim earnings, a divergence driven by improved realised pricing and disciplined cost management rather than volume growth. The result reflects the structural pressure on South African ferrochrome producers, where electricity tariffs and supply reliability have progressively eroded the cost advantage that historically underpinned the country's dominance in the sector. South Africa holds the world's largest chrome reserves, but smelting economics have deteriorated to the point where several producers have curtailed furnace capacity in favour of exporting raw ore — the precise outcome that beneficiation policy is designed to prevent. Merafe's earnings guidance suggests margin recovery is achievable at current pricing, but the volume trend remains the more important signal for the future of domestic ferrochrome smelting.
