Johannesburg, South Africa — MININGREVIEW.COM — 11 March 2009 – South Africa’s Samancor Chrome – the world’s second-largest ferrochrome producer – is to lay off some 20% of its overall workforce, following a sharp drop in demand which prompted production cuts.
The Solidarity union said in a statement here quoting Samancor chief executive officer Jurgen Salomon that the firm would lay off 900 of its 4 690 workers, after ferrochrome prices continued to fall. Samancor said iun a statement that it had failed to find alternatives to prevent the job cuts.
It had notified unions regarding the intended job cuts, but declined to confirm the number of workers to be affected.
“The drop in commodity prices has prompted the need to produce less chrome ore and chrome alloys,” Samancor said. “Production at the smelters and mines in 2009 would be reduced by 55% and 50% respectively compared to installed capacity."
Samancor explained that it had tried various measures at its business units over the past three months, including extended paid leave, terminating contractors and voluntary retrenchment packages. But the ongoing uncertainty of the global stainless steel market had forced it to lay off workers at its two mines and three smelters.
Sales of alloy and export ore will be reduced by about 45% and 60% respectively, Solidarity added.
On December 12, Samancor shut down all its mining and smelting operations until the end of February, and said it would serve customers from available stock.
Samancor spokeswoman Sunel Pretorius told Reuters that the company had resumed operations at 2 of its 16 furnaces. Samancor produces 1.3 million tonnes of ferrochrome a year, she said.