Our operating context

Key statistics for 2022
Global ferrochrome production increased from 14.4mt in 2021 to 15.3mt in 2022

Ferrochrome demand decreased from 14.4mt in 2021 to 14.1mt in 2022

South Africa produced approximately 3.9mt of global ferrochrome production (2021: 3.7mt)
China
imported approximately 12.3mt chrome ore
from South Africa

(2021: 12mt)
Chrome is a
metallurgical marvel.
It brings critical
properties to the
metals with which
it is alloyed.


The global position of ferrochrome

Elements influencing the global demand for and pricing of ferrochrome:
  • Global economic conditions
  • Exchange rates
  • Stainless steel demand
  • Growth of Chinese ferrochrome industry
  • Chrome ore exports

South African chrome industry

Facts
  • Approximately 3.9mt of the world’s ferrochrome production of 15.3mt was supplied by South Africa in 2022
  • Over 72% of the world’s chrome reserves are in South Africa
  • The industry provides approximately 200 000 direct and indirect jobs in South Africa


Challenges faced by South African ferrochrome producers

  • Increasing production costs
    – electricity
    – labour
  • Socio-political challenges
  • Legislative uncertainty
  • Commodity prices and demand
  • Chrome ore exports
  • Electricity supply
  • Logistics

Ferrochrome production and its role in stainless steel

Produced by high-temperature reduction (smelting) of chromite, ferrochrome contains iron, chrome, minor amounts of carbon and silicon, and impurities such as sulphur, phosphorous and titanium.

Chrome is a metallurgical marvel. It brings critical properties to the metals with which it is alloyed. Add it to carbon steel in the form of ferrochrome and the steel becomes “stainless” – corrosion resistant, mechanically strong, heat resistant, hard wearing and shiny. Stainless steel is used almost everywhere in modern life from nuclear reactors to exhaust pipes, architecture, kitchenware and a host of other applications.

Specialty steels produced for applications such as tools, injection moulds, camshafts, etc also derive the high mechanical strength, hardness and heat resistance required from their chrome content.


Our competitive advantage

Elements influencing the global demand for and pricing of ferrochrome:
  • Lowest-cost producer in South Africa
  • Flexibility provided by variety of cost-efficient technologies
  • Savings in energy consumption per tonne of alloy produced as a result of major investments in energy efficiency (Lion Complex and two pelletising and sintering plants)
  • Lion II achieves further energy efficiencies
  • Significant chrome ore reserves and access to UG2

Global
stainless
steel
Production
decreased
from 58.7mt
in 2021 to 56.5mt in 2022
Stainless steel production in China was 32.7 million tonnes (mt) in 2022.

For more information on ferrochrome production, consumption, stainless steel production and chrome ore imports, see the CEO’s strategic review and the graphs in chief executive officer's strategic review.

This source of information set out in our operating context is CRU International Limited (CRU). See chief executive officer's strategic review of this report and the note on chief executive officer's strategic review.

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