STEELPOORT – Another chrome mining company has announced that it will retrench staff soon. Samancor Chrome issued a Section 189 notice on April 26 to all recognised unions representing employees across all operations and corporate offices.

According to the company the severe drop in chrome ore prices resulted in the decrease of the ferrochrome market price, forcing it to issue a Section 189 notice, despite the implementation of several measures at all business units of the organisation over the past months.

These measures implemented by Samancor included reduction of overtime, a moratorium on recruitment and the discontinuance of contractors.

The Section 189 notice that was issued by the company will start the consultation process between itself and the unions.

Samancor Chrome stated that all options will be explored to mitigate the situation.

Its mines are Eastern and Western chrome mines. It also operates three ferrochrome smelters.

According to the Department of Labour, the Amended Relations Act states that a Section 189 refers to dismissals based on operational requirements. In February this year Anglo American Platinum announced that it would place its Twickenham Mine on care and maintenance.

One thousand employees were to be retrenched. Platinum and chrome prices have plummeted in recent years. The future is not looking any brighter.

The World Bank has painted a rather gloomy picture for the mining sector, stating that it does not expect the recent rise in platinum prices to be sustained for the full year, with its latest Commodity Markets Outlook report forecasting a 10 per cent year-on-year price decline in 2016.

The report, released last Wednesday, stated that precious metals’ prices increased by six per cent in the first quarter on stronger investment demand and safe-haven buying.

Silver and platinum prices each increased by one per cent. Platinum’s 13 per cent increase in February and March was attributed to rising gold prices and a stronger rand. South Africa produces about 60 per cent of the global production.

The bank, however, forecast that precious metals’ prices will decline by about two per cent in 2016, mainly as a result of lower investment demand.