By Enyichukwu Enemanna
South Africa’s leading coal mining firm says it plans 1,241 job cuts to deal with lower prices as well as dwindling operational capacity of rail services, a move workers in the mining sector have vowed to resist.
Seriti Resources that made the announcement on Tuesday is a major coal supplier to South Africa’s thermal power stations and also exports some of its output.
According to the privately-owned company, the decision would affect workers at Middleburg mines and Klipspruit South-East pit.
Both operational bases, which have a total number of 5,212 workers in their employ as of March 2024, were acquired from South32 in 2021.
The mines “are not currently commercially sustainable and require material restructuring to improve unit costs and the prospects of future sustainability”, Seriti stated.
“These mines continue to be adversely impacted by, amongst others, Transnet under-performance and general market volatility,” it added.
Heritage Times HT recalls that prices of coal have fallen to a record low, below $450 per metric ton reached in 2022 after invasion of Ukraine by Russia.
At the moment, it stands at about $100 per metric ton.
Apart from power generation, coal is also used directly in high-heat industrial processes, especially steelmaking, and in some cases, it is used to heat homes and buildings.
South Africa’s freight rail operator Transnet continues to struggle to provide adequate services due to shortages of locomotives and spares parts as well as cable theft and vandalism of its infrastructure, impacting coal exporters such as Seriti.
The company said it had on Monday initiated consultations with labour unions under South Africa’s Commission for Conciliation, Mediation and Arbitration (CCMA), a statutory body which mediates and certifies outcomes of labour disputes.
The National Union of Mineworkers (NUM) said it would fight the latest round of job cuts at Seriti.
“The NUM will be embarking on a massive mobilization to try and stop Seriti Resources from undermining unions by retrenching employees willy-nilly,” the union said in a statement.
