No steel increase for now… A breather at last for the steel sector in South Africa as so far there are no confirmed increases for the 1st of March, however there is another issue as Eskom, South Africa’s sole electricity producer has just announced a tariff hike in excess of 15%. This is going to shoot labour costs through the roof and in turn have a ripple effect of increases down the line.
The country continues to battle with a steel shortage with no silver lining yet, there has been positive reports over the past few weeks that levels are expected to increase mid-year however currently the country is battling to cope with the local and export demand.
Mid this week there was an explosion at Arcelormittal’s Vanderbijlpark mill where unfortunately three workers lost their lives as part of a stack of coke batteries reaching 90 meters collapsed and fell on the workers.
Notice has come out this morning that due to this incident, production will be affected on thinner gauge material, namely coil from 1.60mm – 4.0mm which in turn effects the production of tube, pipe, sheets, roof sheets and lipped channels. It is also noted that the current steel shortage is most likely to continue until mid-2021 with consecutive steel increases on the books.
Word from our suppliers in China who have returned from their New Year festivities this week, is that Hot Rolled prices continue to increase which will impact on prices around the world. Some mills have delayed re-opening whilst new prices are prepared, whilst others are insisting on confirming orders first and then agreeing on a price! There are indeed very uncertain times ahead.
SA opens Beitbridge but Zim lockdown still in place, South Africa may have reopened its biggest land borders on Monday 15 January, but Zimbabwe’s decision to extend its lockdown for another two weeks prohibits travel between the neighbouring countries through the Beitbridge border post.
Beitbridge is a major border post which connects South Africa and Zimbabwe and processes thousands of commuters every single day. It’s normally the busiest land port in Southern Africa, but for more than a month, it’s only serviced cargo and nationals with government-endorsed travel exemptions.
Amid growing concerns of a second wave of Covid-19 infections, Zimbabwe returned to hard lockdown at the start of 2021. This included the closure of all non-essential businesses, a strict curfew and the closure of all land borders with exemptions for returning residents and commercial freight. South Africa, suffering from its own second wave closed off all land borders on 11 January where only returning residents, departing foreign nationals, and commercial cargo could pass through Beitbridge during this period.
On Monday 15 January 2021, South Africa reopened 20 border points of entry for travel, after implementing new regulations to curb congestion.
THE Reserve Bank of Zimbabwe (RBZ) has hiked its bank policy rate, from 35 to 40 percent, as part of new policy measures announced yesterday to buttress the prevailing economic stability.
This comes as the bank said the economy was poised for strong growth in the short to medium term, amid stable exchange rate and low inflation.
Apart from raising the bank policy rate to 40 percent per annum, the central bank also hiked the medium-term lending rate for productive sectors from 25 to 30 percent per annum.
The Central bank also increased cash withdrawal limits to 2 000 Zimbabwe dollars for individuals and maintained the current limits on mobile banking transactions at 5 000 Zimbabwe dollars per transaction, which has been aggregated to 35 000 Zimbabwe dollars per week.
The apex bank also increased statutory reserves from 2,5 percent to 5 percent for demand and/or call deposits and maintained the rate at 2,5 percent for time deposits. The variation of statutory reserves by maturity is expected to incentivise banks to hold long-term liabilities or time deposits for long-term lending in the medium-term.
“The reserve money target of 22,5 percent is consistent with the targeted end of year inflation of below 10 percent and projected 7,4 percent economic growth rate of the economy,” the governor said.
The African continent on Tuesday carved its own piece of history when Nigeria’s Ngozi Okonjo-Iweala was elected to lead the World Trade Organisation, as its director-general.
She becomes the first woman and the first African to lead this 164-member organisation in the 73 years of the General Agreement on Tariffs and Trade (GATT), which later transformed to the World Trade Organisation.
A former Nigerian finance minister and World Bank veteran, Okonjo-Iweala shrugged off stiff competition from seven other candidates to lead the global trade body, which had gone for seven months without a leader.
Sibanye-Stillwater’s profits soar, the free cash flow of precious metals company Sibanye-Stillwater rocketed to within a hair’s breadth of R20-billion in the second half of last year.
The Johannesburg and New York listed company reported a sky-high profit rise to R29.3-billion for the six months, up from R62-million in the previous year of 2019. Despite Covid-19, the group delivered a record financial performance and made notable progress towards delivery on many strategic targets.
The company is set to gain a R6.8 billion investment which is expected to create around 7,000 much needed jobs for South Africa.
Tanzania’s gold sector ready for giant leap, construction of gold refining machinery worth 8.9 billion in Mwanza with a capacity to process over 480 kilogrammes per day and can be extended to 960 Kgs per day is complete.
Mwanza Precious Metals Refinery Ltd., which is a joint venture of State Mining Corporation (STAMICO), Dubai-based Rozella Genera Trading LLC and ACME Consultant Engineers PTE Ltd. of Singapore, will be one of the best state-of-the-art gold refineries.
STAMICO Acting Managing Director Dr Venance Mwasse told Minister for Minerals Mr Dotto Biteko on Monday that the refinery plant, the first among three gold refineries currently under construction in the country, was set to be in operation the following month.
The plant ranks number 3 in Africa in terms of processing capacity.
The mineral will be processed there, meaning that no exportation of raw minerals. It will increase the country’s revenue and create over 120 direct employments to Tanzanians.
The project cost of US$58 million, which covered investment, running cost and purchase of gold for the initial ten-days when the refinery starts. Construction started in March 2020.
Vedanta warns off asset pickers, Vedanta Resources has warned potential buyers of assets held in its 85%-owned KCM that any corporate activity would be deemed inappropriate and that it would seek to protect its interests in Zambia and internationally. The Indian owned firm’s comments come as the provisional liquidator appointed by the Zambian government, progresses a plan to split the assets which consists of mining and processing facilities ahead of selling them to third parties.
The Zambian government has through its ZCCM-Investments Holdings company which holds a 15% stake in KCM, has forbidden Vedanta access to KCM’s assets arguing that the group failed to meet investment promises.
Vedanta has contested the matter in the Zambian and South African courts.
As gold prices soared, Barrick counted profits, Mining giants Barrick Gold reported a quarterly profit on Thursday that beat the analysts’ estimates, aided by the jump in gold prices due to coronavirus-induced economic uncertainty. The company’s US-listed shares were up 2.4%.
Gold prices touched record highs in 2020, as investors flocked to what is known as the safe-haven asset while the Covid-19 pandemic mauled the global economy.
In the fourth quarter, market prices averaged $1 875/oz, a staggering 26.4% higher than a year earlier. Barrick said its all-in sustaining costs for the reported quarter rose to $929/oz from $923/oz last year.
For 2021, the company expects the sustaining costs to be between $970/oz and $1 020/oz, compared with $967 in the previous year and they are anticipating full-year production to be between 4.4-million and 4.7-million ounces, compared with 4.8-million ounces produced in the previous year.
The miner also expects a jump copper production this year to be in the region of 410 to 460-million pounds this year as compared with production of 457-million pounds last year.
“A person with too much ambition cannot sleep in peace”