Kumba says it is encouraged by early signs of progress made by Transnet, which helped boost its sales volumes in the quarter ended March.
However, Africa’s largest iron ore producer is not getting carried away by the 5% uplift in Transnet’s rail performance in the period, maintaining its annual production and sales guidance of 35-million to 37-million wet tonnes.
Still, CEO Mpumi Zikalala said the improvement in Transnet’s rail performance, which supported a 6% increase in sales volumes, was “encouraging”. The group is also looking forward to participating in SA’s key logistics sector as the government ramps up the liberalisation of the sector.
“Kumba continues to work closely with Transnet and the Ore Users Forum to prioritise the maintenance related to the independent technical assessment,” the company said.
“As part of the forum, we are also working through the department of transport’s request for information, due for submission on May 9, which will be followed by the request for proposals later in the year.”
Transport minister Barbara Creecy issued a request for information last month to “develop an enabling environment for private sector participation and enhanced investment in rail and port infrastructure and operations”.
The request is not a formal procurement process but a mechanism to understand and source information from the market. The government intends to publish requests for proposals in August.
One of the corridors the request for information focuses on is the Northern Cape to Saldanha bulk minerals corridor, which is primarily used for iron ore and manganese exports. The iron ore line is one of the two main heavy-haul routes in SA, together with the coal line. It stretches 861km, from Sishen in the Northern Cape to Saldanha Bay on the West Coast.
In the three months under review Kumba produced 9-million tonnes of iron ore, down 3% from a year ago due to the proactive drawdown of finished stock at Sishen.
Sishen’s production was 9% lower, but that was largely offset by a 12% improvement in output at Kolomela. Total sales increased 6% to 9-million tonnes due to the improved rail performance.
“Against the backdrop of an uncertain global macro environment, our focus on operational excellence and cost optimisation is even more relevant,” Zikalala said.
“The successful reconfiguration of our business in 2024 significantly improved our resilience in a tougher operating environment. Pleasingly, we have continued to unlock value through our high-quality iron ore products, achieving an average realised price 11% above benchmark prices,” she said.
“The ultra-high dense medium separation technology project at Sishen that will treble the proportion of premium grade iron ore products, is well on schedule. Conversion of the first coarse module is under way, and the engineering design and fabrication are progressing ahead of plans.”
Kumba’s prized asset, the Sishen mine in the Northern Cape, has a lifespan of about 16 years remaining to 2040. In operation since 1953, it accounts for 72% of the group’s annual ore production.
The company said at the end of the 2024 financial year that Sishen had 3,713 permanent full-time employees and 3,555
full-time mining contractors.
Kumba’s board last approved investment of R7.6bn for ultra-high dense medium separation technology at Sishen to boost the quality of iron ore and extend the mine’s operational life. That brought the total investment in the technology to R11.2bn.
Kumba expects the new technology to triple the proportion of premium quality ore production at Sishen, taking it to 55% from 18% now. With Jaqueline Mackenzie
Update: April 24 2025
This story contains new information throughout
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