ZIMASCO to imports coal from Botswana

Tuesday, 23 Aug 2011

It is reported that Chinese controlled ferrochrome producer Zimasco is importing coking coal for its smeltering operations from Botswana where the commodity is generally cheaper and always available.

According to Mr Reason Mandimika mining executive of Zimasco, that importing coal was necessitated by bottlenecks in the local supply chain and at times the costing by local suppliers.

Zimasco expects to increase its annual ferrochrome production to 600 000 tonnes once it completes refurbishment and construction of a new furnace in Kwekwe. This follows the government's renewal of a ban on export of raw chrome ore in March this year.

Mr Mandimika said that "We have been importing coking coal for our furnaces from Botswana primarily because of two reasons; it's cheaper and always available.” He added that the coal from Sengwa was not up to the quality required for smelting chrome.

Hwange Colliery and Sengwa Coals are the two main suppliers on the local market but suffer operational hitches, among them recapitalisation and ageing equipment, particularly in the last decade where hyperinflation wreaked havoc on business.

(sourced AllAfrica)

Merafe swings to FY profit, outlook positive

Tuesday, March01, 2011

* FY Headline EPS at 11 cts vs 6 cts loss
* Sees higher demand, prices ahead
* Shares down 6.6 pct so far this year

JOHANNESBURG, March 1 (Reuters) - South Africa's Merafe Resources (MRFJ.J: Quote), the country's largest ferrochrome producer, reported a return to full-year profit on Tuesday, helped by higher metal prices and said it expects strong results ahead.

Demand for ferrochrome, which is used in stainless steel to prevent corrosion, is recovering after the global economic crisis forced companies in top producer South Africa to slash output in 2009.

Merafe, which operates a joint venture with Xstrata (XTA.L: Quote), said headline earnings per share for the year to end-December totaled 11 cents, from a loss of 6 cents a year earlier.

Headline EPS, the key measure of profit in South Africa, excludes certain one-time items.

The company said its share of saleable ferrochrome output for the year rose to 291,000 tonnes from 281,000 tonnes in 2009, while revenue rose to 2.56 billion rand ($368 million) from 1.84 billion rand.

Merafe said it expects ferrochrome prices to trade higher in 2011 on upward demand arising from growth in stainless steel production.

The company also said restricted supply of electricity in South Africa has resulted in the postponement of a number of planned ferrochrome projects over the next five years.

The company declared a final dividend of 2 cents a share.

Merafe shares have fallen 6.6 percent so far this year, compared with a 0.48 percent fall in Johannesburg's All-share Index .JALSH. (Reporting by Marius Bosch and Olivia Kumwenda; Editing by Agnieszka Flak,sourced:Thomson Reuters)