The South African zinc market is depressed, owing to little recovery from the 2008 economic downturn, along with the current state of the country’s mining industry and the slow roll-out of infrastructure development, states Inter-national Zinc Association Southern Africa (Izasa) regional director Rob White.

He notes that the zinc beneficiation indus-try in South Africa is being discussed and reviewed, owing to power restrictions.

“Since the closure of diversified miner Exxaro Resource’s Zincor, South Africa’s only zinc refinery, at the end of 2011, supply to the local industry has been in a state of flux,” White says.

He adds that, despite new local markets, such as the solar power market, opening its doors to the industry, countries like Mozambique, Kenya and Angola are cur-rently doing better than South Africa.

“Foreign direct investment in Mozambique last year was greater than in South Africa. The zinc mining opportunities in the rest of Africa are great in terms of infrastructure and what is happening in the mining industry,” he notes.

White points out that East Africa is also moving into a period of growth, particularly with regard to the development of infrastruc-ture, including the full gauge railway link from Kenya to Uganda, which has recently been approved after funding was made available.

“Angola also has a strong zinc market and, in terms of East Africa and the Southern African Development Community (SADC) region, things are going well. However, in South Africa, where the majority of the general galvanisers are, the market has not been good,” he notes.

He adds that many zinc and zinc-related sales are made through imports.

Challenges

White believes that the biggest challenge the local industry faces is South African companies’ seemingly poor ability to develop partnerships with customers throughout the continent.

“Networking and developing intrapersonal relationships prior to gaining business is a weak point and Africa is no different from the Middle and Far East. There have also been opportunistic exporters that export only when they have excess capacity,” he explains.

He adds that most of the Brazil, Russia, India, China and South Africa (Brics) coun-tries have been proactive in the SADC region, but that South African companies have not been as active as their Brics counterparts.

“Local players need to take advantage of the infrastructure and mining boom in the rest of the SADC region and start establishing plants in different locations,” he says.

Developments

White notes that new developments, such as producing zinc sulphate and zinc oxide directly from ore-based products rather than from the current supply streams, will drive cost savings.

He adds that there have been changes in the production of zinc chemicals and many companies have shifted from being com- modity businesses to being product businesses.

“It is ironic that this could have occurred quite easily when there was a strong presence from a local supplier. It seems peculiar that it is the absence of that supplier that is forcing these new developments,” White says.

He points out that there have been inter-esting developments in the steel-coating sector, ranging from the zinc aluminium coating plant in Cato Ridge, KwaZulu-Natal, to integrated steel and mining company ArcelorMittal’s developing new coating technologies.

“The current zinc value chain is valued at more than R3-billion and with all the value-adding opportunities that have been considered, such as galvanising continuous tube, pipe and wire, I see interesting times ahead,” he says.

White points out that the establishment of Izasa stemmed from a government and industry initiative and it has always regarded itself as the representative body for the zinc industry, covering all of sub-Saharan Africa.

“We are the platform and local focus point for challenges that impact on the industry. We have good contacts regionally and try to promote zinc as much as we can.

Izasa is involved in project support and we have always kept our membership specific in terms of industry members. We have marketing programmes with every member, which is the business model on which we work,” he says.

He adds that Izasa also tries to implement successes from the International Zinc Asso-ciation, of which Izasa is a part.

“Currently, we have seven members covering the cross section of the industry,” he concludes.