ANGLO American Platinum (Amplats), the world's largest producer of the metal, could become a major ferrochrome producer if it pursues the option of building a 500,000-ton-a-year ferrochrome smelter which will produce competitively priced feedstock for the stainless-steel sector, Metal Bulletin reported last week.
According to the report Amplats, which is 80% owned by Anglo American, is having internal discussions about the option. It quoted Tim Aiken, GM for marketing at Amplats.
But Amplats on Friday denied the report. "Amplats has no intention at all of building or owning a ferrochrome smelter," said Mary-Jane Morifi, head of communication at the company, adding it was not clear in what capacity Mr Aiken had spoken to Metal Bulletin.
The Metal Bulletin report said Amplats was considering the smelter in light of a proposed $100/ton export tax on chrome ore the ferrochrome industry is asking the government to impose to limit ore exports to China.
China has grown its ferrochrome industry at the expense of SA, the world's largest supply of the stainless-steel ingredient.
"Up to now, as a platinum producer, we have not been interested in getting into the ferrochrome game, but now we are seriously starting to look at this as an option in the light of the ferrochrome producers lobbying for an export tax," Mr Aiken was quoted as saying.
If Amplats pursued the option, which would entail it building one of the world's largest ferrochrome smelters, it would absorb chrome ore from the domestic market and take pressure off ferrochrome producers in SA, which are grappling with high electricity prices.
Ferrochrome producers have invested billions of rand in their smelters and argue that China, which has the world's largest steel industry, has grown its domestic ferrochrome industry by importing ore from SA because it has no chrome deposits of its own.
The bulk of SA's chromite-ore exports come from platinum miners, which are increasingly extracting the UG2 reef which contains platinum group metals as well as high levels of chrome. It is a simple matter to insert a chrome treatment plant to process tailings from platinum concentrators.
Of this chromite ore, which comes to about 4.5-million tons a year, half is sold to Xstrata, the world's largest ferrochrome supplier, and the balance is sold to China. Amplats is one of the largest sources of this ore.
China imports about 9-million tons of chromite ore a year, about half of which comes from dedicated chrome miners and platinum miners in SA.
"To be economically viable, we would have a plant with a capacity of at least 500,000 tons per year of ferrochrome. We don't have transport costs for our ore. We would be seriously competitive," Mr Aiken was quoted as saying.
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