South Africa’s last remaining manganese smelter, Transalloys, has issued retrenchment notices that could place around 600 jobs at risk, underscoring the growing crisis facing the country’s energy-intensive metals processing sector.
Transalloys, one of the largest producers of manganese ferroalloys in Africa, operates a smelter complex in eMalahleni, Mpumalanga, a coal-rich industrial hub east of Johannesburg. The company plays a critical role in the beneficiation of manganese ore, a key input in global steel production, and its potential downsizing marks a significant setback for local value-addition efforts.
The retrenchment notices come amid sustained pressure on South Africa’s ferroalloy industry, driven largely by soaring electricity costs and intensifying competition from China, where producers benefit from lower energy prices and state support. Local smelters, which rely heavily on a continuous power supply, have struggled to remain competitive under South Africa’s escalating electricity tariffs, Bloomberg reported.
Despite holding nearly three-quarters of the world’s known manganese ore reserves, South Africa has increasingly exported raw materials rather than processing them domestically, as beneficiation has become less economically viable. Industry analysts warn that the decline of local smelting capacity risks turning the country into a primary exporter of unprocessed minerals, eroding jobs and industrial capability.
Transalloys’ challenges mirror a broader downturn in the sector. Earlier this month, Glencore announced the closure of two ferrochrome operations. In November, trade union Solidarity warned that Samancor Chrome could shed nearly 2 500 jobs as it scales back production.
The ferrochrome and manganese industries are particularly exposed to energy costs, as electricity can account for a substantial portion of operating expenses. Rising tariffs, coupled with persistent supply constraints, have pushed several producers to reduce output or suspend operations entirely.
The government has acknowledged the mounting strain on the sector. In June, South Africa’s cabinet approved a framework aimed at easing pressure on ferrochrome producers, including plans to negotiate revised electricity pricing and consider export controls or taxes on chrome ore to encourage local processing.
However, these measures have yet to be finalised, and proposed export levies have drawn criticism from mining companies, which argue that additional taxes could further undermine investment and accelerate job losses rather than revive beneficiation.
For mining communities such as eMalahleni, where heavy industry remains a major employer, the potential retrenchments at Transalloys raise fresh concerns about economic stability, unemployment, and the future of South Africa’s minerals-processing value chain.
As global demand for steelmaking inputs continues, industry stakeholders warn that without urgent and coordinated intervention on energy pricing and industrial policy, South Africa risks losing further strategic processing capacity to international competitors.
