Govt Enforces ‘Melt and Pour’ Rule for All Steel in Public Projects Nippon Steel expected to finalize U.S. Steel acquisition at $55 per share NMDC Limited reports a 38% drop in Q4 FY24 consolidated net profit RINL to Raise $23 Million Through Land Sales Amid Crisis
Shares plummeted more than 5% after it revealed plans to slash approximately 490 positions, following a decrease in output as it attempts to overcome South Africa's continuous rail delays. Anglo American Plc opened a new tab unit and announced in December that it reduced output to match the state-owned rail operator Transnet's limited capacity. Transnet faces shortages of locomotives and spare parts and widespread wire theft and vandalism.
Iron ore stockpiles totalled 7.1 million tonnes (MT) as of December. Kumba has been compelled to reduce output from 35 MT to 37 MT until 2026 due to the ongoing difficulty in transporting the material to ports for export. During a conference call, Kumba CEO Mpumi Zikalala said that the proposed job cuts, combined with the restructuring of head office roles, which started last September, would affect 10% of the company's workforce. The company employed about 7,000 full-time staff, according to its 2022 annual report.
The restructuring is "necessary" for Kumba to remain competitive, the company said. Job losses across South Africa's mining sector due to weaker commodity prices and infrastructure challenges add pressure to the government ahead of elections later this year.
South Africa's official jobless rate, measured at 31.9% in the third quarter of 2023, is among the highest in the world.
On Monday, Anglo American Platinum opened a new tab and announced plans to cut 3,700 jobs in South Africa after a sharp decline in metal prices slashed annual profit by 71%.
Kumba's headline earnings per share rose 26% to ZAR 70.80 in the year ending Dec 31, up from ZAR 56.19 the previous year, as its high-grade iron ore continues to fetch prices 15% above the benchmark rate.
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