South Africa eased antitrust rules to allow competitors in industries hit by high power costs to cooperate on negotiating cheaper power supply in a bid to prevent their total collapse, a move that potentially helps the country’s ailing ferrochrome industry.
Trade, Industry and Competition Minister Parks Tau changed the scope of an energy users’ block exemption in the Competition Act in regulations published January 5, allowing firms operating in “industries in distress” to jointly negotiate buying energy, share ownership of backup generation capacity and collectively work with suppliers as long as no price-fixing of goods and services takes place.
While the regulations didn’t stipulate which industries this affects, South Africa-based processors of ferrochrome and manganese — key ingredients in steelmaking — are idling operations and laying off thousands of workers, blaming high electricity prices for undermining the viability of their businesses.
Competition from China has also hit domestic processors in South Africa, which has about three-quarters of the world’s identified manganese-ore reserves.
The country has grappled with rising electricity costs that have roughly tripled over the past 15 years, far exceeding inflation.
The continent’s biggest economy has also contended with inconsistent supply since 2008, owing to mismanagement and corruption at Eskom, the state-owned supplier responsible for more than 80% of generation. Industry and consumers endured hours of daily power cuts for years through 2023, denting output, growth, and confidence.
In late December, Transalloys, the operator of South Africa’s last remaining manganese smelter, said it may have to cut as many as 600 jobs because of the cost of energy.
Glencore Plc’s ferrochrome unit said earlier in the month it would shutter two operations. In November, labor union Solidarity said Samancor Chrome may cut almost 2 500 jobs as it curtails operations.
South Africa’s cabinet approved a plan in June to negotiate new electricity prices and introduce potential controls and taxes on chrome-ore exports.
© 2026 Bloomberg