South Africa: Kumba iron ore production to be impacted due to Transnet force majeure

Kumba was served a notice of force majeure by Transnet SOC Limited (Transnet) on 7 Oct’22 due to the ongoing strike spearheaded by Transnet’s unions.

Anglo American has put in place contingency preparations to protect its assets and minimise the effect on operations. However, as a result of the delay in Transnet’s rail and port services, the expected effect on iron ore output is 50,000 tonnes (t) per day for the first seven days and 90,000 t per day thereafter. Approximately 120,000 t per day will be lost in export sales, company sources divulged.

Transnet, which operates South Africa’s freight rail network and all the country’s ports, declared force majeure on Thursday. The strike has been called to protest against the offered wage increases by Transnet SOC Ltd. for the new financial year as well as the fact that no wage increases were approved for the current financial year.

Iron ore production from Kumba stood at 9.47 mnt in Q2CY’22, down 4% y-o-y from 9.82 mnt in Q2CY’21 given the impact of safety intervention. Meanwhile, sales increased by 10%South Africa: Kumba iron ore production to be impacted due to Transnet force majeure on a yearly basis to 10.3 mnt in the period under review, reflecting improved logistics performance.