JOHANNESBURG – African Rainbow Minerals (ARM) has moved to commercialise a proprietary smelting technology that could fundamentally alter the cost dynamics of South Africa’s embattled heavy industry. The technology, branded as SmeltDirect, reportedly slashes electricity consumption by more than 70% and reduces carbon emissions by approximately 60%, offering a potential lifeline to a sector that has seen widespread closures due to prohibitive power costs and global decarbonisation pressures.
The diversification giant, led by executive chairperson Dr Patrice Motsepe, is positioning the innovation as a cornerstone for reindustrialisation. Unlike conventional systems that require roughly 4 MW of electricity to produce a ton of alloy, SmeltDirect operates on just 1.2 MW. This efficiency shift effectively places users at the bottom of the global cost curve, potentially enabling South Africa to reclaim its former status as the world’s leading producer of ferrochrome and ferromanganese.
The commercial roll-out is gaining momentum at ARM’s Machadodorp Works in Mpumalanga. Andre Joubert, Chief Executive of ARM Ferrous, confirmed that the group has moved beyond the research phase, having completed a bankable feasibility study for ferrochrome production at the facility. The site is now being prepared to serve as a hub for processing ores locally, a move that would halve the volume of material currently transported to international markets.
“We’re engaging with various partners in terms of partnering with us to commission such a new plant and commercialise our new technology, which saves more than 70% of electricity consumption if you want to produce the same amount of ferrochrome alloys,” Joubert said in a media statement regarding the group’s financial results. He added that the system is “actual, factual and ready” to support the production of high-manganese rail and green steel.
Beyond the technological leap, the socio-economic implications are substantial. ARM estimates that for every 200,000 tonnes of alloy produced annually via SmeltDirect, approximately 700 jobs are created. This represents a significant reversal for an industry that once supported over 200,000 direct and indirect jobs before the “death spiral” of electricity price hikes forced major players to shutter operations.
While the group remains bullish on technology, it is adopting a cautious stance on energy self-generation. Despite completing a feasibility study for its own solar plant, ARM has opted to procure renewable energy from independent power producers (IPPs) via shorter-term contracts. This strategic pivot allows the company to capitalize on immediate cost savings while navigating the current legislative uncertainty and evolving tariff structures at Eskom.
