The implications of mineral resources beneficiation in South Africa

Abstract

South Africa is ranked amongst the top five mineral-rich countries in the world. It takes first position when it comes to platinum reserves. Most of the mineral resources are exported in raw form to foreign destinations and they are then imported back into the country as finished goods. Government has come up with a local mineral beneficiation strategy that has in it about ten mineral resources that have been identified as the initial minerals that need to be beneficiated in the country. This study investigated challenges that would be faced by the country when implementing mineral beneficiation. The study was a qualitative study that was done through field interviews that were conducted on industry practitioners and related industries. Fourteen interviews were conducted in this study. The study found that there are challenges that are faced by local industries around pricing of mineral resources. They feel that they are overcharged, yet they are at the doorstep of mining. They feel that overcharging emanates from import parity pricing that is imposed on the raw material making them pay a price that is equivalent to that that is paid by importers of South African raw minerals in foreign destinations. The other challenges that were identified are energy, market, water utilities and government regulations. Energy was identified as the most serious challenge that is facing the country and that will definitely negatively affect implementation of a local mineral beneficiation strategy. Local beneficiation will be good for the country’s economic growth, employment, skills development, and many other benefits, but the challenges have to be taken care of first before embarking on implementation of the strategy.