South African Mining Companies and Mining Houses are Being Reevaluated

South Africa holds the world's largest reserves of gold (35%), platinum group metals (55.7%), manganese ore (80%) chrome ore (68.3%) titanium metals (21%). It also produces a large share of the world's diamonds and mineral deposits.

Lucrative opportunities exist for downstream processing and value adding of iron, carbon steel, stainless steel, aluminium, platinum group metals and gold.

Beneficiation of minerals before export is a major growth area. The Department of Minerals and Energy has embarked on a small-scale mining programme aimed at encouraging and facilitating the development of economically viable small-scale mining and mineral-based industries, in line with the government's desire that small miners gain access to mineral rights suited to small mining activity.

Relationships between individual mining companies and the controlling mining houses are being reevaluated. Mergers, restructuring and unbundlings have created much optimism for the industry in recent years, driven by the need to develop black ownership, to expand abroad and by a languishing gold price.

Mining and minerals in South Africa:

South Africa is a world leader in mining. The country is internationally renowned for an abundance of mineral resources, accounting for a significant proportion of both world production and reserves, and South African mining companies dominate many sectors in the global industry.

South Africa is the world's biggest producer of gold and platinum and one of the leading producers of base metals and coal.

The country's diamond industry is the fourth-largest in the world, with only Botswana, Canada and Russia producing more diamonds each year.

Although well over a century old, South Africa's mining industry is far from fully tapped. The country is a treasure trove, with mineral deposits only matched by some countries of the former Soviet Union.

While holding the world's largest reserves of gold, platinum-group metals and manganese ore, the country has considerable potential for the discovery of other world-class deposits in areas yet to be exhaustively explored.

Only two strategic minerals - crude oil and bauxite - are not available in the country. For the rest, the sector spans the full spectrum of the five major mineral categories, namely precious metals and minerals, energy minerals, non-ferrous metals and minerals, ferrous minerals and industrial minerals.

Apart from its prolific mineral reserves, South Africa's strengths include a high level of technical and production expertise, and comprehensive research and development activities.

The country has world-scale primary processing facilities covering carbon steel, stainless steel and aluminium industries, in addition to gold and platinum.

Minerals beneficiation:

With the growth of South Africa's secondary and tertiary industries as well as a decline in gold production, mining's contribution to South Africa's gross domestic product (GDP) has declined over the past 10 years.

However, this may be offset by an increase in the downstream or beneficiated minerals industry, which the government has targeted as a growth sector.

Lucrative opportunities exist for downstream processing and adding value locally to iron, carbon steel, stainless steel, aluminium, platinum group metals and gold.

A wide range of materials is available for jewellery, including gold, platinum, diamonds, tiger's eye, and a wide variety of other semi-precious stones.

Industry transformation:

South Africa's mining industry is continually expanding and adapting to changing local and international world conditions, and remains a cornerstone of the economy, making a significant contribution to economic activity, job creation and foreign exchange earnings.

Change strategies adopted by the industry since the end of apartheid in 1994 have made it more competitive.

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