Eskom and Transnet woes threaten mining jobs

The scenario has develop into so dire that the ANC has requested Anglo American to carry off on deliberate job cuts in South Africa till after the 2024 elections.

It’s been a horrible week for mining, with 11 staff killed in a mine shaft accident at Impala’s Rustenburg operations, whereas a number of mining firms introduced plans to cull jobs amid a commodities downturn and deteriorating effectivity at South African ports.

The scenario has develop into so dire that the ANC has requested Anglo American to carry off on deliberate job cuts in South Africa till after the 2024 elections.

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The deteriorating state of SA’s ports is simply the most recent in a collection of mishaps at state-owned firms which have left many corporations considering their future operations in SA.

Volkswagen SA has refuted current rumours that it’s planning to depart SA as a result of deteriorating enterprise atmosphere, however corporations throughout the nation depending on dependable vitality and speedy entry to ports are having these fateful discussions in personal.

The query is: can authorities restore Eskom and Transnet sufficiently to keep away from a tsunami of job cuts as we head into 2024?

The prospects usually are not good. The backlogs are too deep, and band-aid repairs to infrastructure can solely take us thus far.

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What’s taking place within the mining business could also be an omen of what’s to come back.

Specific pressures on mining

Miners have needed to cope with extra than simply erratic electrical energy provide and choked-up ports – their prices have risen above inflation charges whereas commodity costs have fallen.

They’re accustomed to this type of existential menace and the restructuring that comes with it. That can doubtless result in extra mechanised mining and everlasting job losses.

Wesizwe Platinum this week introduced that some 571 employees out of a complete of 761 at its Bakubung mine within the North West could possibly be retrenched following three labour stoppages, the final one unprotected, that had harm the corporate’s mine improvement progress.

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The hostile results of the strikes had been compounded by the downturn within the mining business, the corporate stated in a Sens assertion.

Additionally this week, ArcelorMittal stated it’s considering winding down its lengthy metal merchandise enterprise, which can impression its operations in Newcastle and Vereeniging.

This might imperil 3 500 workers and contractors as the corporate commences the compulsory Part 189 consultations when it comes to the Labour Relations Act, which is a prelude to retrenchments.

Every week in the past, the Nationwide Union of Mineworkers (NUM) issued an announcement following its Nationwide Govt Committee, saying it’s “shattered and disillusioned” by the excessive ranges of attainable job losses, significantly in mining.

“To this date, near 10 000 jobs stand to be misplaced between now and January 2024,” it says, including that staff who’re about to lose their jobs don’t have anything to have a good time this festive season, and the current slight drop in unemployment is more likely to reverse.

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“The NUM could be very disillusioned with Transnet’s incapability to easily transport minerals to the nation’s terminal ports. Mining firms are sitting with stockpiles of minerals that must be transported to terminals in Richard’s Bay.”

The commerce union plans a march on 9 December to President Cyril Ramaphosa’s workplace and the Division of Public Enterprises to protest job losses as a result of Transnet’s decay.


ArcelorMittal stated a slowing home economic system had diminished obvious metal consumption by 20% within the final seven years, leading to market overcapacity and weaker enterprise confidence. It additionally blamed electrical energy outages, escalating vitality prices, excessive transport and logistics prices, and SA’s well-publicised logistics failures.

Another excuse cited by ArcelorMittal for the wind-down of the longs enterprise is the preferential pricing system for scrap steel, a 20% export responsibility, and a ban on scrap exports that gave a man-made aggressive benefit to producers utilizing electrical arc furnaces to provide metal versus iron ore-to-steel beneficiation.

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“The ArcelorMittal South Africa Board and Administration have reached this level after having exhausted all attainable choices,” stated ArcelorMittal SA CEO Kobus Verster in an announcement.

“As troublesome as these circumstances are, now we have an obligation to make sure that the enterprise stays sustainable in the long run, within the pursuits of the Firm and its stakeholders. The remaining enterprise, after the wind down, will likely be on a extra sustainable monetary footing and in a position to make investments the suitable capital in product improvement and out there progress prospects.”

Sibanye, Impala, Glencore and Seriti

In October, Sibanye-Stillwater stated it had commenced Part 189 consultations that might impression almost 4 100 workers and contractors, about 8.6% of the workforce, because it restructures 4 shafts, two of that are mature, in its southern African operations.

A number of the shafts are loss-making, threatening the sustainability of the remaining operations. Current declines in platinum group steel costs and above-inflation will increase in electrical energy, water, wages and gas contributed to the choice.

Earlier this month, Impala Platinum stated it might provide voluntary retrenchment packages to cut back the headcount and save prices within the face of a 40% drop in palladium costs and a 14% drop in platinum costs this 12 months.

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Glencore and Seriti introduced they’d lower jobs in response to a pointy drop in coal costs, whereas Thungela stated it was scaling again some underground operations and redeploying affected staff.

As NUM identified per week in the past, the slight enchancment in unemployment ranges trumpeted by authorities will doubtless disappear as soon as the most recent bout of job cuts is tallied and manufacturing corporations resembling ArcelorMittal be a part of the deindustrialisation march.

This text was republished from Moneyweb. Learn the unique right here

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