Mining and materials group Afrimat is assessing “viable” options for its Nkomati Anthracite Mine as the troubled asset feels the effects of SA’s ferrochrome woes.
This is despite the company on Tuesday noting that it had seen operational improvements at Nkomati Anthracite Mine, where 100,000 tonnes were processed through the plant in July.
“An assessment of underground viability led to the mothballing of the underground mining operation. Due to decreased demand from ferrochrome smelters during the period, volumes amounted to 136,216 tonnes (August 31 2024: 155,686 tonnes),” the company said.
“Unfortunately, in August 2025, due to structural economic impediments in the local economy, all ferrochrome smelters were temporarily shut down.
“Management is currently assessing viable options for the Nkomati mine to minimise the effect of the ferrochrome smelters’ prolonged shutdown and will update shareholders on the progress when we have better clarity.”
The Nkomati mine has always been a challenging asset for Afrimat.
Group CEO Andries van Heerden, in his annual letter to shareholders, gave a frank assessment of the mine, admitting management was caught napping in attending to “multiple challenges” facing its Nkomati Anthracite Mine.
The challenges include an “extensive drive” to get the required environmental impact assessment (EIA) over the line and adjusting the mine’s management structure.
SA’s ferrochrome smelters, including those owned by industry majors like Glencore, have been shutting down at an alarming rate due to high energy costs, among other challenges, putting on the line thousands of jobs.
The ANC this week opened the door for the government to provide electricity relief to the industry, among other measures, which include steps against the illegal mining of raw chrome.
Shares in Afrimat surged more than 10% on Tuesday after it told investors it expected to report at least a 90% surge in headline earnings for the six months ended in August, which were expected to be 90%-95% higher at 100.7c-103.4c, it said.
The group attributed the rise in earnings to an improvement in sales volumes, particularly in local iron ore, and a recovery in market share.
In its construction materials, the aggregate components had a slow start to the year but experienced a marked improvement in sales volumes, with enhanced operational efficiency at the acquired Lafarge quarries in the second quarter and the recovery of previously lost market share.
Afrimat’s acquisition of Lafarge’s local quarry operations has begun to bear fruit. After years of neglect, the group has invested heavily to restore the assets, integrating management and IT systems to boost operational efficiency.
Afrimat’s fly ash business was experiencing solid growth in volume and profitability after the completion of several projects.
The group said the cement business was expected to be loss-making in the first half, though plant reliability had improved and production disruptions had decreased.
In its industrial minerals unit, orders from the agricultural sector arrived late due to delayed rainfall and subsequent planting. These volumes will be reflected in the second half. This segment was affected by reduced volumes resulting from the shutdowns of ferrochrome smelters.
The group is due to release its first-half earnings on October 23.
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