South Africa’s only graphite electrodes plant, which is also the sole manufacturer on the African continent, is facing possible closure, putting 370 jobs at risk.

The plant, established in 1965 in Meyerton, 50 km south of Johannesburg, currently supplies half of the South African market with graphite electrodes that conduct power into electric arc furnaces to melt ferrous scrap for steelmaking.

GrafTech South Africa GM Craig Taylor emphasised to Engineering News, however, that closure was currently still at the proposal stage.

“We are busy with a consultation process at the moment with the unions and employee repre- sentatives. The consultation process has to run its course and, if there is no viable alternative, closure should take place by June 2014.”

The two unions concerned are the National Union of Metalworkers of South Africa and Solidarity.

GrafTech South Africa is a wholly owned subsidiary of the NYSE-listed US-based GrafTech International, which has told shareholders that it intends closing the plant “subject to certain ongoing union and workforce consultations”.

Should closure ensue, GrafTech South Africa will continue to distribute graphite electrodes from the group’s other manufacturing plants in the US, Mexico, Spain and France.

It is only the South African and Brazilian facilities that face termination as a consequence of being the two highest-cost operations.

In contrast, GrafTech International’s Monterrey plant, in Mexico, which is actually earmarked for growth as one of the company’s “most advantaged facilities”, is expected to increase capacity by 15 000 t in less than a year with minimal employee additions.

Growing the low-cost Mexican production facility would further lower the company’s overall graphite electrodes cost structure, GrafTech International CEO Craig Shular said at this month’s third-quarter presentation to shareholders.

The bulk of GrafTech South Africa’s 370 employees – which make up more than half of the potential 600 employees impacted globally – stand to lose their jobs in the event of the plant closing.

Since the 2008 global financial crisis, the global industry has been in an oversupply situation.

The closures in South Africa and Brazil are expected to cut 60 000 t out the company’s global graphite electrodes capacity and, with related overhead initiatives, yield $75-million in yearly cost savings.