Glencore Faces Potential Job Cuts at South African Ferrochrome Venture

Glencore (LON:GLEN) is currently engaged in consultations regarding potential job cuts at its South African ferrochrome venture with Merafe Resources, impacting the Boshoek and Wonderkop smelters, according to reports on Monday.

This development stems from persistent economic headwinds facing the South African ferrochrome industry. The increased concerns about the venture's future profitability and Glencore's overall exposure to the region.

Merafe Resources disclosed that the consultation process, initiated on September 1, 2025, is in accordance with Sections 189 and 189A of the Labour Relations Act.

The move is a direct response to the ongoing economic pressures and the absence of viable, sustainable solutions for the ferrochrome sector in the near to medium term. The Lion smelter is also under review, potentially facing a reduction to half of its operating capacity.

Further streamlining is being explored within the mining division, as well as at the Rustenburg and Lydenburg smelters, which are already under care and maintenance.

Glencore, as the operator of the venture, is also restructuring its head office and shared services functions. These measures collectively point to a significant operational overhaul aimed at mitigating losses and improving efficiency.

The impact of these potential job cuts and operational changes on Glencore's financials remains uncertain, but the market has reacted negatively. Glencore shares fell 1.1% on Monday and are down around 0.8% so far on Tuesday.

The South African ferrochrome industry has been grappling with rising electricity costs, labor disputes, and volatile commodity prices. These factors have collectively eroded profit margins and forced companies to re-evaluate their operational footprint.

The restructuring efforts by Glencore and Merafe Resources are indicative of the difficult environment and the need for decisive action to ensure long-term viability.