Trade union Solidarity says the time is ripe for negotiations for an appropriate Eskom power tariff that can keep the ferrochrome industry afloat while benefitting other parties.

Although this willingness to negotiate is welcomed, and retrenchments at Glencore-Merafe’s and Samancor’s smelters have been postponed as a result, retrenchments have not yet been finally averted, Solidarity deputy general secretary Willie Venter notes.

“A win-win agreement is nevertheless possible and hard work must now be done to find a sustainable solution.”

He refers to Eskom having signed a memorandum of understanding with Samancor Chrome and the Glencore-Merafe Chrome Venture on December 8, in a bid to finalise an electricity tariff solution that prevents the closure of additional smelting capacity and averts the threat of widespread job cuts in the sector.

Various ferrochrome producers have warned throughout the year that they cannot operate sustainably with the prevailing electricity tariffs and that retrenchments and closure of operations are imminent.

“We hope the new proposed tariff will be of such a nature that it can make the employers sustainable. With this, the ferrochrome industry will hopefully be able to revive, and the smelters will be able to start working again, which will create thousands of new job opportunities,” Venter states.

He adds that South Africa urgently needs this, including downstream companies.

In its recent National Economic Development and Labour Council negotiations with government, Solidarity called for a special electricity tariff that would particularly contribute to the salvation of the ferrochrome and steel industries.

“Of course, a sensible solution would be one through which Eskom can also maintain its profitability and, hopefully, this can remain so over the longer term so that new growth and job opportunities can be stimulated,” Venter explains.

Apart from the electricity tariff, Solidarity also considers it necessary that its other demands be heeded, for example that Transnet’s challenges be dealt with as a matter of urgency; that imports and the dumping of products, such as steel, from China and India be restricted; and that an agreement on trade tariffs be reached with the US.

Solidarity believes the opportunity is presenting itself for solutions that create new business opportunities that in themselves would mean increased tax revenue for the government.

“Decisions can now be made that will be beneficial to all parties,” Venter concludes.