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| Glencore Lion ferro chrome smelter |
Lion Smelter Resumption Signals Market Recovery
Glencore plans to restart its 720,000 t/yr Lion ferro-chrome smelter in South Africa this February. The resumption follows weak European demand and high electricity costs that previously halted operations. Meanwhile, Boshoek and Wonderkop smelters remain on care and maintenance, reflecting selective operational focus. As a result, Glencore strengthens its South African ferro-chrome supply while managing energy and market risks.
Energy Costs and Policy Impact on Ferro-Chrome Production
South Africa’s electricity reforms are crucial for the viability of ferro-chrome operations. Eskom proposed a tariff adjustment last week, but Merafe deemed it insufficient for long-term sustainability. Therefore, operational costs remain a key factor influencing smelter efficiency. In contrast, policy clarity could stabilize production and attract further investment in South African chromium ventures.
Employment and Industry Implications
Merafe issued retrenchment notices affecting 1,200–1,400 workers, while Samancor Chrome may risk 2,500 jobs. Meanwhile, the broader ferro-chrome industry could see 300,000 direct and indirect jobs impacted if closures persist. Consequently, steel producers and scrap traders must monitor supply constraints and policy developments to adjust procurement strategies.
ScrapInsight Commentary
Glencore’s Lion smelter restart could partially ease ferro-chrome supply tightness in South Africa. Electricity pricing and policy reforms remain decisive for long-term operations. Traders and steelmakers should track production, labor impacts, and regional market shifts for procurement and pricing strategies.
