Exxaro’s logistics costs jumped by R1.4bn in 2024 as it transported 1.9-million tonnes of export volumes via the Maputo corridor.
Sakkie Swanepoel, Exxaro’s head of marketing and logistics, said Exxaro will always prioritise the export route of Richards Bay Coal Terminal (RBCT) via available Transent Freight Rail (TFR) capacity, given its potential efficiency. However, it remains constrained.
“Exxaro has realised that definitely in the short to medium term but most probably in the longer term the RBCT/TFR route is never going to be enough for our export ambitions, and we need to develop a second strategic export corridor, which is what we do with Maputo,” said Swanepoel.
The Maputo export channel had been “painful” but necessary. “It is painful to follow that route, but we are, in the long term, very hopeful we will see more of our tonnes coming from rail than truck, even this year already,” he said.
Acting CEO Riaan Koppeschaar said after the release of the group’s 2024 financial results that finding new logistics options for Exxaro was important. Export tonnes have declined, to only 5-million tonnes in 2023, down from 12-million tonnes in 2022 , he said.
The group managed to increase its 2024 export volumes to 7-million tonnes, of which 1.8-million tonnes went through alternative logistics channels, mostly Maputo. However, “the additional logistic channels are coming at a cost,” he said.
To rein in costs at the Maputo channel, Exxaro is exploring options to rail coal to that market . “At the moment, we are using multimodal transport, and we transport coal via road to a central point and then it is loaded onto a train. There are options to use rail for that full value chain,” Koppeschaar said.
Exxaro chief growth officer Richard Lilleike said the group was also pursuing opportunities in battery metals such as copper, nickel and phosphate.
“We are looking wider in terms of the mix of battery materials. In our pipeline, we have studies going on into graphite and lithium, and some of the more industrial commodities. [It is] an exciting pipeline of commodities we’re hoping to bring to the investment process,” he said.
Manganese was also on the group’s growth radar — it is a bulk commodity with a very similar mining strategy to coal, it is available in South Africa and Exxaro understands Transnet.
It’s about unlocking a transaction, it is about engaging, it is about finding the right time and convincing parties that we are the right buyer through either structuring or price.
— Richard Lilleike, Exxaro chief growth officer
“The rationale for why we want to acquire manganese is strong, but the challenge is actually doing a deal, given there are only five or six sizeable producers in the country, [and] all of them are cash positive through the cycle. It’s about unlocking a transaction, it is about engaging, it is about finding the right time and convincing parties that we are the right buyer through either structuring or price,” he said.
Exxaro on Thursday named former Lonmin CEO Ben Magara as its incoming CEO, saying his appointment followed an “expedited and targeted selection process”. Magara’s appointment is effective from April and Koppeschaar will continue in his role as director of finance.
Exxaro appointed Koppeschaar as acting CEO in December after placing former CEO Nombasa Tsengwa on precautionary suspension, pending the outcome of an independent investigation into alleged workplace and governance issues. Tsengwa resigned in February after a court ruled that her application to have the suspension overturned lacked urgency.
The group’s chief coal operations officer, Kgabi Masia, who was suspended while on a work trip in Switzerland last year, remains suspended as a probe continues. Mervin Govender, previously the GM at Grootegeluk mine and former group projects manager, is acting in Masia’s position.
Exxaro’s full-year revenue increased 5% to R40.72bn in 2024, up from R38.6bn a year earlier — mainly due to a 6% increase in coal revenue and a 5% increase in energy revenue.
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