Eskom reports that South Africa is looking for ways to assist ferrochrome companies.

Eskom, the state-owned power utility, announced on Monday that it is looking for ways to support South Africa's ferrochrome sector.

Eskom stated in a press release that the memorandum with the two companies was the result of constructive discussions on Friday between the minister of electricity and the energy of the country and the trade unions.

Samancor Chrome, the joint venture between Glencore & Merafe Resources and Samancor Chrome have announced that they are looking at job cuts due to pressures such as the cost of energy.

Eskom reported that the energy regulator Nersa has been reviewing a temporary power tariff adjustment. The government is also working on a long-term mechanism for competitive pricing in the ferrochrome industry.

According to Glencore's estimates, South Africa has approximately 80% the known world chrome ore reserves. This makes the country a major player in the global ferrochrome industry.

Eskom said that once an interim tariff is approved for Samancor Chrome, and the Glencore/Merafe Chrome Venture, the companies will commit to suspending layoffs and bringing back approximately 40% of their furnace capacities while a longer-term solution is developed.

(source: Reuters)