By: Daily investor

South Africa’s last operational manganese smelter is facing possible job losses and reduced operations due to soaring electricity costs. Transalloys, based in eMalahleni, has issued retrenchment notices to employees and is running only two of its five furnaces, warning that up to 600 positions could be cut if power pricing issues are not resolved.

CEO Konstantin Sadovnik stated that the company’s electricity costs are approximately double those of international competitors, making sustained operations economically unviable. South Africa holds about three-quarters of the world’s manganese ore reserves, but high energy prices and competition from China have eroded the competitiveness of local smelters.

The ferrochrome sector is also under strain, with companies like Glencore and Samancor Chrome announcing closures and job reductions in recent months. In response, the South African cabinet approved a plan in June to negotiate new electricity tariffs and consider export levies on chrome ore. However, these measures have yet to be finalized, and the proposed export tax has faced opposition from mining companies.

Sadovnik emphasized that manganese processing is even more energy-intensive than ferrochrome production, leaving the industry particularly vulnerable. Without clarity on affordable power pricing, Transalloys expects to proceed with restructuring by February 2026.