Merafe Resources reported a 72% slide in full-year profit after suspending operations at its ferrochrome smelters due to high electricity costs.

Merafe's headline earnings per share fell to 12.2c in the year ended 31 December 2025, from 42.9c previously.

The company, which operates a ferrochrome joint venture with Glencore, idled its plants in April 2025, citing soaring power costs and increased competition from Chinese smelters.

As a result, ferrochrome output from the Glencore-Merafe joint venture fell 63% to 112,000 metric tonnes in fiscal 2025.

Production costs rose 14% during the year, mainly due to lower output.

South African smelters are struggling to compete with Chinese rivals amid power tariffs that have surged more than 900% since 2008, putting thousands of jobs at risk.

In January, the National Energy Regulator of South Africa (Nersa) approved a 35% reduction in electricity tariffs for Merafe and fellow producer Samancor, allowing Merafe to restart its largest plant, the Lion smelter, last month.

On February 27, power utility Eskom offered a further 29% tariff cut to the distressed smelters, pending regulatory approval.

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