South African union vows to fight job cuts at Samancor smelter after energy deal

Wed, 11th Mar 2026 11:38

* Samancor going ahead with lay-offs despite electricity cost cut

* Government ⁠cuts power costs to avert job losses

* Soaring power costs have decimated smelting sector

* Smelters struggling to compete with Chinese rivals

March 11 (Reuters) - South ‌Africa's National Union of Mineworkers on Wednesday vowed to fight planned job cuts at ferrochrome ⁠smelter Samancor, which could affect 2,400 employees even after ⁠a more than 50% electricity price reduction meant to avert job losses.

State-owned power utility Eskom on February 27 announced the price cut for Samancor and Glencore's joint venture with Merafe Resources after the distressed ‌firms agreed last December to shelve planned job cuts while negotiating with Eskom.

Their electricity costs had risen tenfold since 2008, exacerbating the smelters' problems as they face growing competition from Chinese producers. Samancor has, however, resumed procedures to lay off workers, while the Glencore-Merafe JV said it had deferred its own job cuts to ‌March 31.

"This move comes as a devastating blow to the workforce, particularly after NUM fought tirelessly to negotiate ‌for lower electricity tariffs to ensure the sustainability of the company's operations," the union said in a statement.

"The union remains committed to challenging this and will explore all available avenues to save the jobs of our members," it added.

South Africa's labour laws require ‌companies to consult unions before implementing job cuts.

Samancor Chrome was not immediately available to comment.

The proposed layoffs are expected to impact approximately 2,400 employees across the company's ⁠smelting and ⁠corporate offices, NUM added.

The government says only 11 out ‌of South Africa's 66 smelters are operational, mainly due to high electricity costs.

Africa's most advanced economy and the world's biggest chrome ore producer, South Africa has lost its ‌position as the top global processor of chrome into ferrochrome to China.

Energy-intensive smelters combine chromium and iron to produce ferrochrome, which is mainly used in steel production.