The soccer World Cup has come as a curse for South Africa s manganese producers and the prices of the commodity is set to go up considering the fact that South Africa s production will be hit.
South Africa is home to 80 per cent of the world s manganese reserves making any disruption in supply of the metal a force in the marketplace.
Eskom, South Africa s electricity company, has been under pressure for shortfalls in electrical production for quite sometime.
Mining companies like BHP Billiton, Xstrata Plc and others are some of the largest consumers of South Africa s strained power supply. With the power drawn for the World Cup these issues are only being exacerbated and mining companies may be the first to feel the pinch.
Eskom, which supplies 95% of South Africa s electricity, has committed to ensuring uninterrupted power supply for the FIFA World Cup. Electricity to mines could be the first load to shed.
In 2008, the last time South Africa faced an electrical load shedding issue, Eskom cut power to mining operations and the price of platinum skyrocketed.
Physical Platinum ETFs went from $158.44 per security, to a high of $222.06 on March 3, 2008, an increase of 40%. This is because electricity demand exceeded supply in South Africa and miners were forced to use only 90% of capacity, thereby reducing production.
If the demands of the football tournament were not enough for the already struggling power company, a looming workers strike may be the final straw. Eskom s workers are asking for a pay increase and housing allowances, threatening a strike of the most public fashion, during the World Cup.
South Africa is home to 80 per cent of the world s manganese reserves making any disruption in supply of the metal a force in the marketplace.
Eskom, South Africa s electricity company, has been under pressure for shortfalls in electrical production for quite sometime.
Mining companies like BHP Billiton, Xstrata Plc and others are some of the largest consumers of South Africa s strained power supply. With the power drawn for the World Cup these issues are only being exacerbated and mining companies may be the first to feel the pinch.
Eskom, which supplies 95% of South Africa s electricity, has committed to ensuring uninterrupted power supply for the FIFA World Cup. Electricity to mines could be the first load to shed.
In 2008, the last time South Africa faced an electrical load shedding issue, Eskom cut power to mining operations and the price of platinum skyrocketed.
Physical Platinum ETFs went from $158.44 per security, to a high of $222.06 on March 3, 2008, an increase of 40%. This is because electricity demand exceeded supply in South Africa and miners were forced to use only 90% of capacity, thereby reducing production.
If the demands of the football tournament were not enough for the already struggling power company, a looming workers strike may be the final straw. Eskom s workers are asking for a pay increase and housing allowances, threatening a strike of the most public fashion, during the World Cup.
