JOHANNESBURG, April 2, 2026, 16:23 SAST
Glencore plc’s South African ferrochrome venture has pushed a deadline for possible layoffs to April 7 after Eskom asked for a week more to finish internal approvals on a discounted power package for the struggling industry. The extension keeps alive talks over a 62 South African cent-per-kilowatt-hour tariff that the venture says it needs to keep smelters viable. 1
The delay matters because Glencore has said lower electricity costs are essential to reopen mothballed smelters and avoid job losses at a time when South Africa’s ferrochrome sector is under severe pressure. On March 19, Glencore Ferroalloys CEO Japie Fullard warned up to 1,500 jobs were at risk if no workable deal was struck, while rival Samancor Chrome has already resumed layoffs despite getting the same headline tariff relief. 2
Power is the crux. South Africa’s smelters have been squeezed by tariffs that Reuters reported have risen more than 900% since 2008. Only 11 of 66 smelters are operating, and the country has lost ground to Chinese producers in ferrochrome, the chromium-iron alloy used mainly in stainless steel. 3
In a March 31 statement, the Glencore-Merafe Chrome Venture said Eskom had approved the 62 c/kWh tariff in principle but was still working through internal governance steps. It said the Section 189 process — the legal consultation procedure that comes before retrenchments in South Africa — would now run until April 7. 1
The venture said it had already submitted a final counterproposal to Eskom on March 12 after deciding some of the attached conditions were commercially unworkable. Any revised package would still need approval from NERSA, South Africa’s energy regulator, before it could take effect. 4
Fullard signalled how narrow the room for compromise had become. He said last month Glencore would not be “in a position to sign” if the terms stayed as they were, and warned the company could “walk away” from the 62-cent deal. 2
Eskom announced the latest tariff in February, cutting the price to 62 South African cents per kilowatt-hour from an interim 87.74 cents, after NERSA had approved a 35% relief package in January from a prior tariff of 1.36 rand. Electricity Minister Kgosientsho Ramokgopa said the intervention was aimed at stopping further closures in a sector the government wants to revive. 3
The earlier January cut was enough to restart the Lion smelter in February after a nine-month shutdown, but Merafe said the Boshoek and Wonderkop plants remained mothballed and would need the 62-cent tariff to run on a sustainable basis. That is why Glencore keeps pressing for the lower rate, not just a temporary discount. 5
Merafe’s 2025 results showed the cost of delay. The listed company said ferrochrome output from the Glencore-Merafe venture fell 63% to 112,000 metric tons last year, while production costs rose 14% because the plants were idled. 6
But the rescue could still unravel. The revised tariff still needs NERSA approval, and January relief only went through after the government agreed to fund the gap between the old tariff and the discounted rate so ordinary users would not pay more. Samancor, meanwhile, has kept moving ahead with layoffs affecting about 2,400 employees. 7
Eskom said in December that an interim tariff could let Samancor and the Glencore-Merafe venture suspend layoff processes and bring back about 40% of furnace capacity while a longer-term fix is developed. South Africa still holds about 80% of the world’s known chrome ore reserves, according to Glencore. For now, the extension keeps that rescue plan alive for another week. 8
