JOHANNESBURG (miningweekly.com) – London-listed International Ferro Metals (IFM) on Monday reported a 16% quarter-on-quarter drop in ferrochrome production for the three months ended September 30, as a result of planned yearly maintenance.

Production for the quarter amounted to 48 216 t, with sales of 48 183 t in line with production, but down 8% quarter-on-quarter.

“As guided at our full year results, the third calendar quarter is traditionally a weaker quarter for the company, due to the planned annual maintenance of the furnaces and the impact of this on production volumes and associated costs,” IFM CEO Chris Jordaan commented.

He added that, despite this, the company had, made progress on a number of fronts, including the successful restarting of the Lesedi underground mine, in the North West, the completion of the drill programme at the Rooderand chrome mine, in the North West, and the revival of upper group two supply from Anglo American Platinum.

Further, Jordaan said that, although costs had increased during the quarter, owing to higher winter power tariffs, the company expected these costs to normalise again during the last three months of the calendar year.

Meanwhile, the company’s net borrowings increased in line with guidance during the period under review, to R434-million as at September 30, from R338-million as at June 30, owing to higher working capital requirements and the seasonal increase in electricity tariffs.

IMF further pointed out that it expected to be able to restart its cogeneration plant during the second quarter of the 2015 calendar year, following the arrival of the chiller system, that should reduce load on the plant’s system components, in January next year.

At full and stable furnace production, the plant was expected to generate about 10% of the company’s total electricity requirements.

“The industry continues to be driven by the dynamics of the Chinese market and is characterised by uncertainty, particularly in the short-term.

“However, as cost pressures continue to mount for the industry as a whole, we believe that most fundamentals point towards a price recovery, either through short-term inflationary pressures, or a combination of low ore and alloy stock levels and limited supply of raw materials,” Jordaan noted.