Oct 17, 2012
Lack of consensus, strategic integration holding back beneficiationBack
Johannesburg|Africa|Exploration|Industrial|Industrial Development Corporation|Platinum|PROJECT|Project Management|Resources|Africa|South Africa|Institute For African Alternatives|Mining|Value Chain|Ben Turok|Infrastructure|Jorge Maia|Mbuyazwe Magagula
© Reuse this
Speaking at a media briefing following a consultative meeting on beneficiation at the Industrial Development Corporation (IDC) head office, he indicated that many private sector players cited hurdles relating to government departments as hampering their efforts to beneficiate more of South Africa’s minerals.
“Some say they will start beneficiating when it makes commercial sense, but the State has the role of creating the environment for this to happen,” Turok stated.
Linkage issues within the value chain, such as infrastructure and training would have to be addressed.
A lack of consensus regarding what beneficiation entailed was also holding back efforts to go beyond exploration, extraction and processing.
“There is no common understanding of the science and technology and process of beneficiation. Every company or department sees it differently. But we have started the process of creating coherence,” Turok explained.
It was agreed at the meeting that regulation, combined with incentivisation would be a better option than to pressure mining companies into beneficiation initiatives.
As one of the world’s best-resourced countries, South Africa’s low beneficiation rate was a “conundrum”, Turok said.
“South Africa has the largest chrome deposit in the world, but ore is exported raw…we do have companies that can create ferrochrome, they do some smelting, but not full beneficiation,” he said, adding that a great deal of the last stage of the value chain happened abroad.
Turok stated that the country’s export basket was too dependent on minerals and that it would have to be expanded to contain manufactured goods as well.
“We need to address the highly concentrated nature of South Africa’s merchandise export basket, reduce our economy’s vulnerability to cyclical trends and improve our competitiveness in global markets.
“We import too many manufactured goods, we have the capacity to manufacture it ourselves.”
IDC research and information head Jorge Maia said South Africa held 88% of the world’s platinum-group metals reserve base, but that its utilisation was at 0.4%. “There is still a lot of potential for extraction,” he noted.
The country also contained 80% of the world’s manganese reserves and 72% of its chrome ore reserves.
“We must turn this into competitive advantages,” he said, reiterating that further development of these reserves and subsequent beneficiation would be beneficial for South Africa on many levels.
“Beneficiation promotes industrial diversity in the spread of downstream processes and would ensure more balanced growth,” Maia indicated.
It would also build industrial competitiveness and promote skills and technological developments, while playing a central role in attracting foreign direct investment and rejuvenating private sector investment activity.
IDC mining and minerals beneficiation head Mbuyazwe Magagula said the development finance institution would assist with funding and project management, as well as research and development in the drive towards increased beneficiation.
Turok said the draft report of the meeting would be finalised and given to the private sector and the Parliamentary portfolio committees of relevant departments, among others, the Department of Trade and Industry and the Department of Mineral Resources.
“Then we will have to discuss how to take the process further,” he said.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Updated 6 hours ago Government, in conjunction with industry clusters had to encourage preferential procurement in the mining industry, Department of Trade and Industry (DTI) capital equipment and allied services director Tapiwa Samanga has said. In a statement issued on Monday, he...
Updated 6 hours ago The South African Property Owners’ Association (Sapoa) has appealed to Rural Development and Land Affairs Minister Gugile Nkwinti to invoke the discretionary powers available to him under the Spatial Planning and Land Use Management Act of 2013 to prevent...
Updated 6 hours ago The Financial Services Board (FSB) has extended telecommunications group MTN’s broad-based black economic-empowerment trading platform MTN Zakhele’s exemption to the directive requiring over-the-counter (OTC) trading platforms to apply for a licence to operate,...
Recent Research Reports
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
This Week's Magazine
South African State-owned defence industrial group Denel has announced its fourth consecutive year of profits. The group's results for the financial year 2013/2014 were recently announced at its head office in Centurion, south of Pretoria. Revenues grew by 17%, net...
There is little opportunity for JSE-listed infrastructure company Group Five to grow shareholder value in the domestic market, says CEO Mike Upton. He says value can still be found in the private sector, in the renewable and industrial power sector, as well as in...
The National Association of Automobile Manufacturers of South Africa (Naamsa) has announced the event dates of the 2015 Johannesburg International Motor Show (JIMS). The event will take place from October 14 to October 25, 2015, at the Johannesburg Expo Centre, Nasrec.
UK engineering support services provider Babcock is set to deliver the largest order of global truck manufacturer DAF’s truck tractors in Southern Africa to bulk carrier road-based logistics company Ngululu Bulk Carriers (NBC), with 133 trucks to be delivered in...
Digital radio communications in the African local government space can open up the world, but have many challenges to overcome, notes integration and migration of legacy radio communications infrastructure with digital mobile radio company Emcom Wireless head of...