top of page

Market Commentary | The week that was

Minister of Public Enterprise Visit to China: Minister Pravin Gordhan will lead discussions with Chinese government counterparties to resolve the deadlock over the delivery of locomotives and spare parts by rail equipment manufacturer CRRC E-Loco. Due to irregularities in the contract awarding of over R54 billion, the South African state-owned rail equipment supplier Transnet, halted the supply of 1 064 locomotives from four original equipment suppliers, including CRRC. An urgent intervention due to the impact of the declining performance of Transnet’s freight rail division on the economy. Minister Gordhan is optimistic that the discussions will produce productive outcomes that lead to effective and efficient logistics of the nation's economy and SOCs. Sasol awaits approval to sell cyanide: Sasol South Africa is the exclusive producer of sodium cyanide used in the refining process of recovering gold from ore. The sale of Sasol’s sodium cyanide asset to Draslovka Holdings, a Czech international company, was rejected by the Competition Commission in November 2021. The South African mining industry is dependent on Sasol for the supply of liquid cyanide. The acquisition of sodium cyanide by Draslovka SA may result in local users being charged more because of an import-parity price. Sasol appealed and argued that the effects of pricing were already evaluated and dealt with by the Commission during the review process, and the prohibition of the sale was unexpected. End of April, the tribunal received factual and expert economic evidence and will finalize its decision within the weeks to come. Eskom finalizing the diesel budget: Eskom’s poor performance of its coal-fired generation fleet resulted in running the diesel-powered emergency generation fleet to a greater extent than expected, to limit load shedding. Hasha Tlhotlhalemaje, Eskom's GM of Regulation, said that the National Energy Regulator of South Africa's (NERSA) tariff decision for Eskom for the 2023/24 financial year made provision for diesel expenditure of R8.4bn. Despite the initial budget, Eskom spent three times more on diesel to run the open-cycle gas turbines (OCGTs). The minister of electricity has warned South Africans that increased stages of load-shedding will continue during winter. Markets: The South African Reserve Bank (SARB) is expected to continue hiking interest-rate as headline inflation has increased for the second consecutive month to 7.1% in March. Tuesday morning, the Rand was trading at R18.41/$, R20.16/€, and R22.90/£, Brent crude is trading at $78.85 a barrel. Looking ahead: CPI inflation is expected to ease up in the coming months, and the Department of Mineral Resources and Energy announced that both grades of petrol, 93 and 95 octane will increase by 37 cents a liter.



8 views0 comments

Recent Posts

See All
bottom of page