Every Friday morning, SAfm’s AMLive’s radio anchor Darshan Moodley speaks to Martin Creamer, publishing editor of Engineering News and Mining Weekly. Reported here is this Friday’s At the Coalface transcript:
Moodley: Lets start with these new American owners. They are shutting down one of South Africa’s best-established factories because they say it is no longer globally competitive.
Creamer: The Americans have decided to close South Africa’s sole graphite electrodes plant, in fact, Africa’s sole graphite electrodes plant, which is essential in steel making because it allows the electricity to flow into the scrap to melt it in the steel making process. This is an age-old company, now called GraphTech in Meyerton, 50 km south of Johannesburg.
It has been going since 1965 and all of a sudden the Americans, GraphTech International, which is listed on the New York Stock Exchange said that they have six plants, two of them are duds, one of them in South Africa and they are going to chop it. That means 370 jobs.
I really think we should do something to try and save this plant. We know that if we turn this operation into a trading operation, which it’s heading for, it will take those products coming in from the US, Mexico, France and Spain, we are going to become traders. If you haven’t got that manufacturing in your economy you get so unsophisticated that your citizenry suffers. As it stands now, Mexico has given us a blue eye because they are the favourite ones.
They are going to be expanded because Mexico has made the cut. South Africans and Brazilians are down the shoot, that means 600 jobs, three quarters of them from South Africa. We are going to be the ones that suffer the most. Can we not do something? We have this process where the unions have to talk and go into consultation, so it won’t just close immediately.
It is in that that we could save this plant and hopefully the Department of Trade and Industry or someone will come in. We are in a cyclical business and things are down now, there is an oversupply now. But, we will come out of that and we must try and keep this going, because it is Africa’s only graphite electrodes plant.
Moodley: Saving this plant, saving lives, also very important at the mines protecting people from harm. This could create jobs couldn’t it?
Creamer: Brand new safety measures, just introduced on South Africa’s mines, have already created 5 000 new non-mining jobs and built a booming business. If you look at the statistics there, what we are doing with these net-and-bolt safety systems that save people from having rock fall down on their head, we are putting in 170 000 safety bolts a day.
We are putting in 200 km of safety nets and it has already slashed the fall of ground fatalities by 80%. But, what has it done? The nets alone have created 2 000 jobs. The bolts have created 3 000 jobs.
If you look at the magnitude of this, you will see how huge our mining industry is. If you take those bolts and you had to install them at a kilometre apart on the circumference of the earth daily, they would go around four times. If you took those nets and stretched them out they would stretch from here to Rustenburg daily or from Rustenburg to Witbank daily.
This is massive business and it is all about saving lives, but at the same time it can stimulate economic activity in the economy, which we see it doing. One of the companies, Impala Platinum, which is now going to have the whole of the Impala Rustenburg Mine covered with these aerial nets, last year had its best safety record in history.
It cost an additional R200-million a year going forward, but it shows you how you can save lives and boost your economy simultaneously.
Moodley: The Kimberly Process wanted us to have conflict-free diamonds, they weren’t willing to offer more money for it unfortunately, but in the DRC we have had some movement on conflict-free metals.
Creamer: We’ve just heard from the US-State department, which came through in a Washington conference call with South Africa with journalists in Kinshasa and, in fact, all over Africa.
They gave an update on the Dodd-Frank legislation. We know that Dodd-Frank comes after Chris Dodd and Barney Frank in the US. In 2010 they introduced this idea that you can’t take tantalum and tungsten and gold from areas that are in conflict. These are going into our laptops and all sorts of things but they are actually killing people down the line in the DRC.
Obama in 2010 wrote into law this Dodd-Frank act and it has been rather slow in rolling out. The State Department came through to journalists this week and just in tin alone if you take that tin, the people who are actually certified that they are coming with conflict-free tin are earning twice the price.
They are earning an attractive premium instead of getting $2/km for their tin they are now getting $4/kg for their tin, which is a great upliftment. Of course, it does cost between US30c and US50c to actually do that job of bagging and tagging. It shows you that it is absolutely worth it in the case of tin and it will be likewise for tantalum and tungsten. Gold has already come through with a lot of issues, because in the eastern Democratic Republic of Congo there is still a lot of conflict.
Their warlords can’t sort out the south Kivu and north Kivu and these people are still fuelling their wars with minerals control. But, slowly you see 150 sites have now been declared conflict-free. That is still a small percentage though. There is still a long way to go, not an easy thing to do, but we see that if you do the things right and you clear your minerals of blood, you can earn a premium price.
Moodley: Thanks very much. Martin Creamer is publishing editor of Engineering News and Mining Weekly, he’ll be back with us at the same time next week.