Hernic business rescue update reflects South Africa’s power supply struggle

Hernic Ferrochrome’s business rescue proceedings and its planned sale to fellow chrome producer Samancor Chrome have been beleaguered by South Africa’s longstanding power constraints and resulting high prices.

Earlier this year, lack of generating capacity forced South African state power group Eskom to implement load shedding - controlled blackouts - to reduce pressure on the country’s grid, leading to a short-lived spike in ferro-chrome prices amid supply shortage fears. But plentiful supply and subdued demand has since dragged prices to two-year lows, despite rising production costs. Fastmarkets ferro-chrome index 50% Cr import, cif Shanghai has held at 73 cents per lb since August 23, compared with 83 cents per lb when Hernic’s business rescue began. Hernic entered business rescue...

Published

Janie Davies

September 10, 2019

15:12 GMT

London