Ferrochrome production from the Glencore-Merafe Chrome Venture dropped by 63% in 2025 compared to 2024, according to Merafe Resources’ report on Tuesday, January 20. Production attributable to the company declined from 301,000 tons in 2024 to 112,000 tons in 2025. A significant factor in this sharp decrease was the venture’s very low output of 147 tons in the final quarter of 2025, which occurred while smelter operations were suspended due to poor market conditions.
On the chrome ore side, Merafe’s attributable fourth-quarter chrome ore production from the venture was just 2% lower, with 222,000 tons produced—mainly due to temporary equipment breakdowns. Total chrome ore production for 2025 was 932,000 tons, down from 948,000 tons in 2024.
Meanwhile, Merafe’s share of platinum group metals (PGMs) concentrate production in the fourth quarter rose 5% to 4,000 ounces, with the yearly total also rising by 1,000 ounces to 15,000 ounces. Merafe, primarily focused on its 20.5% stake in the Glencore-Merafe Venture (with Glencore holding 79.5%), is listed on the Johannesburg Stock Exchange and A2X in the general mining sector. Its wholly owned subsidiaries participate in the venture’s earnings before taxes, depreciation, and amortization.
A key issue is that South Africa’s private-sector ferrochrome industry continues to face challenges due to high electricity tariffs imposed by the public sector. This has led to an electricity tariff proposal from state-owned power utility Eskom to help support operations at the venture’s flagship lower-energy Lion ferrochrome smelter in Limpopo province.
However, efforts are ongoing to restore economic sustainability at the Wonderkop and Boshoek ferrochrome smelters in North West province. Although turning chrome ore into higher-value ferrochrome creates jobs and closing smelters is detrimental to South Africa, finding cost-effective solutions has become a protracted challenge in today’s low-price ferrochrome market.
For years, greater profits came from mining chrome ore and refining it into ferrochrome. Now, however, exporting raw chrome ore has become more profitable than processing it domestically.
In December, Eskom signed a memorandum of understanding with the venture and Samancor Chrome, aiming to finalize an electricity pricing solution to prevent further smelter closures and avoid widespread job losses in the sector.
Currently, the focus is on securing power rates low enough for South African ferrochrome producers to remain competitive, including the possibility of special economic zone inclusion for smelters and eliminating illegal chrome ore mining, which accounts for about 10% of exports.
Eliminating illegal mining would remove 10% of chrome units from the market and benefit the industry, which recognizes the value of beneficiation—leading to increased revenue, more jobs, and reduced logistical strain.
Additionally, there is potential for investment in new lower-energy SmeltDirect technology, which could cut power needs by 70%, if greater certainty exists in the industry.
The trade union Solidarity believes a win-win agreement is possible and that decisions can be reached to benefit all stakeholders.