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JOHANNESBURG (miningweekly.com) - JSE-listed ferrochrome producer Merafe Resources said on Thursday that ten of its furnaces would undergo routine maintenance at different times during the next three months.
The company usually opted for furnace closures during winter months to mitigate the higher winter electricity supply tariffs.
The Xstrata-Merafe chrome venture would operate on around 65% capacity during the maintenance period.
Merafe Resources financial controller Kajal Bissessor told Mining Weekly Online that the company was previously operating at around 85% capacity, which meant that Merafe would be working at a 20% reduction for the next three months, equating to a 5% reduction in production for the 2010 financial year.
Meanwhile, she noted that Merafe's deliveries to customers were affected by the national Transnet strike, but added that the company expected to make up the backlog of deliveries in due course and did not anticipate any material impact on its sales volumes.
Bissessor also said that ferrochrome stockpiles were still low at between ten- to 12-week, with prices almost double that of the second quarter last year at $1,36/lb, compared with $0,69/lb in 2009.
The Xstrata-Merafe chrome venture supplies around 20% of the world's ferrochrome requirements, and has operations in South Africa's North West, Mpumalanga and Limpopo provinces.
