IFL ferrochrome sales plunge

19th Jul 2011 08:16

Ferrochrome producer International Ferro Metals reported reduced output in the quarter to 30 June as it upgraded its facilities and saw sales whacked by a fall in demand.Production was down by 17% from the same period the previous year to 42,584 tonnes, while sales plunged by 37% to 34, 735 tonnes."Industry experts are forecasting a record year for stainless steel production in 2011 and again in 2012, however the third quarter is traditionally weak and we have seen this in lower benchmark prices and reduced output of ferrochrome from the South African producers," said chief executive David Kovarsky. "This market backdrop, together with substantially higher winter electricity tariffs, reduces the opportunity cost of IFL's reduced production during the roof upgrades, reinforcing management's decision to undertake the work during this period."He said that cost-cutting actions aimed at making it one of South Africa's lowest cost ferrochrome producers, leave the company well placed to take advantage of higher prices in the fourth quarter.---RG