South Africa’s ailing smelter industry needs coal

Sep 1

Written By Menar

Coal power is indispensable to reversing the overwhelming decline of South Africa’s alloys industry, which has resulted in massive job losses.

Speaking at the 2025 Mpumalanga Coal Conference hosted by FFF Carbon, Menar’s Managing Director, Vuslat Bayoglu, pointed out the negative impact of expensive and unreliable power supply on the country’s industrial prospects. Bayoglu spoke on the back of ArcelorMittal’s long-steel plant closure announcement, which has placed 3500 jobs on the line.

He shared examples of other operations in the alloys sector that have been either mothballed or completely shut down over the years, due to operational costs mostly driven by high electricity costs and poor supply. Earlier in the year, Assmang also closed its Cato Ridge Smelter in KwaZulu-Natal. According to the Ferroalloy Producers Association, about 4,596 direct jobs and 16,900 indirect jobs in the alloys industry were impacted across 10 operations between 2014 and last year.

Bayoglu said SA’s reindustrialisation needs all power sources, emphasising that coal’s exclusion from the country’s energy mix would only hinder the country’s industrial recovery. Titled Quo Vadis, South Africa? Coal’s Future, his presentation was based on a Latin phrase meaning Where are you going? Bayoglu said SA must decide carefully on the direction it intends to take on coal going forward. “South Africa's energy landscape stands at a decisive crossroads, caught between the government’s recognition of coal as one of the country's top five critical minerals and pressure to stop using it,” he remarked.

Looking into the future, Bayoglu said electricity demand would rise exponentially, and data centres would be a leading cause of this growth. With SA as the fastest-growing data centre market on the African continent, the forecast is that significant power capacity will be needed to support this growing sector. Currently, coal accounts for two-thirds of power generation globally, with consumption expected to remain above 9 billion tonnes in 2025. “South Africa faces growing pressure to close its coal-fired coal stations, but it cannot do this without risking further industrial decline. A diversified energy portfolio is the only realistic path to reindustrialise its economy,” he said.

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