The South African quarrying sector, which is seldom afforded the recognition it deserves as a member of the mining industry, is a significant player in the country’s widespread extractive industries scenario, with a good track record and steady growth prospects in at least the medium-term.
Making this point in an interview with Mining Review Africa, Aggregate and Sand Producers’ Association of Southern Africa (Aspasa) director Nico Pienaar says that, according to the most recent survey conducted, quarrying was the sixthlargest mining sector in the country in terms of tonnes mined.
“Using estimated market volumes tabled by Aspasa, quarrying, in combination with the limestone industry (the so-called LAS index), has earnings in excess of R6 billion a year, of which quarrying accounts for R3.8 billion,” he says. “This places it fifth in revenue generation behind gold, platinum group metals, diamonds and coal. It ranks alongside iron ore, and is a significantly greater generator of revenue in the SA economy than nickel, chrome, copper and manganese.”
The quarrying industry is represented by Aspasa and the Institute of Quarrying of Southern Africa (IQSA).
The institute represents individual members involved in quarrying, and promotes the fellowship of its members through the advancement, promotion and development of the quarrying industry.
It has two main functions: to provide ongoing professional development through regional meetings, technical conferences and social events; and to co-ordinate education and training for the industry.
Aspasa, on the other hand, is a member of the Chamber of Mines and represents those companies that are in the business of producing aggregate and sand. The association consists of 65 member companies representing close to 130 quarries throughout the country. These companies are responsible for about 70% of the aggregate and sand produced in the country.
The support that Aspasa gives its members is on the strategic and advisory sides of business. A great deal of work is put into promoting the industry and the association to the outside world, but also to ensure interaction among companies and producers within the industry.
The association provides services through specialist regional and working committees concentrating on such aspects as: health and safety; the environment; education and training; legislative matters, human resources aspects; and technical advice.
Pienaar says that the quarrying industry employs between 15,000 and 20,000 people. “We are very mechanised as an industry. Conveyor belts and crushers do most of the work.”
He adds that renewed confidence in South Africa and rapid growth in demand since 2004 gave rise to some encouraging capitalisation in the aggregate and sand industry, which in turn has resulted in increased capacity and product quality. However, he warns that the industry remains hyper-competitive, and in some areas displays poor standards and low productivity, compared to its first world counterparts.
A supply capacity profile for the aggregate and sand quarrying industry, which was calculated in a presidential study conducted by Aspasa, arrived at a figure of 106.37 million tonnes for 2006, and showed a steady increase to 120.17 million tonnes in 2010.
“This 13% rise over four years can be linked in part directly to the World Cup, with construction of various new soccer stadiums and related projects such as Gautrain, various shopping centres, houses and upgrading of infrastructure,” Pienaar says. “Once all this is over, activity will slow, as forecast in the figures of close to 119 million tonnes for 2011 and 2012. But another steady improvement is forecast for the industry, with a 13% increase to 134.18 tonnes in the four years to 2016.
“One must bear in mind, however, that these figures, which are linked to cement sales, are under-stated,” Pienaar explains. “There is a substantial proportion of illegal quarrying in the country, and, needless to say, this production is not included in the official figures.
The industry has potential for significant growth in the formal and informal sectors in the medium term, but to achieve this growth will require improved co-operation between members and the authorities, and between the members themselves, as well as improved execution by the state of its responsibilities. This will help create stability in the industry and ensure its future sustainability in South Africa.
“I believe we will have steady growth, because we need infrastructure,” Pienaar suggests.
A comparison of per capita consumption of aggregate provides another indicator of the significant potential for future growth in South Africa. “We need to get the per capita use of our materials up if we are to become a prosperous country. Our per capita consumption is 2,000 kilograms, compared with 5,000 kilograms in the United Kingdom and 10,000 kilograms in the United States.
“When you take into account the country’s growing need for infrastructure – housing, roads, airports, harbours, railway lines, dams, bridges, hospitals, police stations, schools, sewerage and so on, it is not difficult to appreciate why our industry is not simply necessary……it is crucial to the survival of South Africa,” Pienaar says.
“If everything goes according to plan on the political front and we have a good government, and with government beginning to see the need to pump far more into infrastructural development and focusing on that strategy, we will find ourselves to be in a really good industry,” Pienaar concludes.