Prominent South African miner experiencing the hardest times in its history

Afrimat bemoaned the local operating environment in its latest business update, saying that, in its 20-year history, these are some of the hardest times the miner has faced.

Afrimat is a multi-commodity, mid-tier mining company that produces and supplies construction materials, cement, iron ore, anthracite, phosphate, and high-quality industrial minerals.

The company was formed and listed on the JSE in 2006 through the formal merger of Prima Klipbrekers and Lancaster Quarries.

Operating at the intersection of South Africa’s mining and construction industries, Afrimat has come under pressure in recent years amid deterioration in both sectors.

Despite this pressure, Afrimat has undergone significant expansion, even breaking past the R10 billion mark in its 2026 financial year.

It also completed the acquisition of Lafarge’s South African assets in 2024, which the company believes could be a significant growth lever.

Afrimat released a business update on Tuesday, 25 August, detailing its operations in the first quarter of its 2027 financial year.

The company said operating conditions deteriorated this quarter and that its results were affected by several factors.

This includes a stronger rand, which reduced iron ore export revenues, as well as lower international iron ore prices and significantly higher shipping rates resulting from the war in Iran.

The company also pointed to an overtraded cement market and sharp increases and volatility in fuel prices as pressure points.

These factors are expected to have a cumulative effect on Afrimat’s results in the first half of its 2027 financial year.

“In its 20-year history, these are some of the hardest times Afrimat has faced, yet its people and culture continue to show resilience, positivity, operational discipline and leadership in adversity,” the firm said.

However, the company added that it expects the second half of the financial year to improve relative to the first half.

Despite the tough operating environment, Afrimat said it experienced some tailwinds, including securing a MECA III manganese export allocation of 240,000 tons per annum.

The mining firm also gained an additional iron ore deposit in Doornfontein, aimed at extending the life of operations and lowering production costs.

The group said it is seeing the benefits of its Lafarge acquisition play out, with its Aggregates division’s operating profit achieving a 36.29% CAGR since 2022.