The mining sector plummeted in February to a three-year low, following continuous gold strikes, load-shedding and slow global growth.
Production has been hard hit in recent months by strikes at gold mines led by the Association of Mineworkers and Construction Union (Amcu), where about 15,000 workers affiliated to AMCU have been on strike for almost five months at the Driefontein, Kloof and Beatrix mines.
Slowing global growth, particularly in China, has softened demand for metals, too. Load-shedding has also threatened to further dent the sector.
“These factors present material headwinds for the remainder of the year,” FNB economist Jarred Sullivan said.
Mining production decreased three times more than expected — 7.5% year on year in February — after a 3.3% contraction in January, data from Statistics SA showed on Thursday.
This is the fourth consecutive contraction for the sector and the lowest level since March 2016. Economists polled by Bloomberg had expected a contraction of 2.5%.
Most sub-sectors reported lower production in February compared to a year earlier. The largest negative contributors were diamonds, down 48.3%; gold, down 20.6%; and iron ore, down 20.7%.
“With little prospect that the factors which are constraining the sector will alleviate meaningfully in the near term, the outlook for the mining sector in coming months remains dire,” NKC economist Elize Kruger said, warning that a double-digit quarterly decline seems certain for the sector, which could drag down overall growth in the first quarter of the year.
Compared to January, mining production decreased by 1.5% in February.
Stats SA reports that its mining production index, which was set to 100 points in 2015, was 81.0 in February, down from 84.7 in January 2019 and 87.6 in February 2018.
The total sales of SA’s mining industry in February came to R38.62bn, a fall from R41.65bn in January but an increase from R34.91bn in February 2018.
Stats SA shows coal is SA’s biggest revenue earner, with sales of R11.55bn in February followed by platinum group metals (PGMs) with total sales of R7.1bn, then iron ore at R5.3bn.
Meanwhile, manufacturing accelerated slightly in February but growth remains constrained by the re-emergence of load-shedding which has weighed on production volumes.
Manufacturing production grew by 0.6%, slightly above the Bloomberg consensus of 0.5%.
“The latest activity figures add to the evidence that growth in SA softened at the start of 2019. Conditions will probably pick up later in the year, but growth will remain tepid,” Capital Economics economist John Ashbourne said.
Source – Business Day Live
Please take note that the South African Revenue Services will be migrating to a new electronic services hosting platform from the 12th of April to the 16th of April 2019.
It should be noted that during this period, exports from South Africa should expect delays.
While processing at customs border posts will still be possible during this period, in the event that there is a customs query attached – the file shall remain pending until the completion of the migration on 16 April 2019.
This will have a direct impact on all loads.
The Customs Electronic Data Interchange (EDI) gateway, which is the primary electronic channel used by Customs clients to communicate with SARS, will not be impacted.
The South African Revenue Services and Organized Labour have recently been engaged in wage negotiations. A decision was made by Organized Labour that the strike action will commence Thursday 28 March 2019.
To limit the potential impact of the strike action on SARS branches, customs offices and ports of entry, SARS have put in place a contingency plan to address key areas of the business that could be affected by the strike action.
Delays are likely to be experienced at branches and ports of entry into South Africa as a result of capacity constraint. Electronic Data Interchange (EDI) communication will continue, however where manual intervention is required delays will be imminent.
JOHANNESBURG - Sibanye-Stillwater says the formal restructuring process it has started is expected to last three months.
Sibanye has warned that close to 6,000 miners are in danger of losing their jobs after it recorded losses worth R1 billion at its gold operations in 2018.
However, unions have vowed to fight any threats of retrenchments at Sibanye-Stillwater.
Sibanye says it will look at measures to avoid and mitigate retrenchments in its gold mine operations.
The company has also been plagued by a three-month-long strike by members belonging to the Association of Mineworkers and Construction Union (Amcu) who are calling for higher wages.
Sibanye spokesperson James Wellsted says the situation is dire.
“If we don’t do this, the losses that we’re experiencing at these operations could reduce the lives of other profitable operations because that money can be invested in the sustainability of other operations, which now is spent at loss-making operations.”
The company is also expected to announce losses of up to a billion rand in its financial results next week.
Gideon du Plessis, the general secretary of Solidarity, says they’re communication with Sibanye to find alternatives to job losses.
Meanwhile, Amcu has vowed that it will fight any planned retrenchments at Sibanye-Stillwater.
Source – EWN
Dear Valued Customer,
Abeyla Exports would like to inform you, that we will be closed for business on 9th and 10th August 2018 for Women’s Day in South Africa.
We will resume business on Monday the 13th August 2018.
Abeyla Exports wishes you and your family safe travels and a restful weekend.
Thank you for your continued support.
Dear Valued Customers,
Please click on the following link for the latest price increase notice:
Operations Director – Southern African Region