The measures, designed to curb illegal mining and revive the struggling ferrochrome sector, have drawn a mix of cautious approval and strong opposition across the mining value chain.

What will targeting of illegal chrome miners involve:

• Law enforcement actions: Arrests of illegal miners, seizures of chrome ore and machinery, operations to dismantle illegal operations. For example in the country's Limpopo and Northwest provinces
• Regulatory oversight of exports: Requiring export permits from International Trade Administration Commission will make it harder for illegally mined chrome to leave the country unchecked. Permits imply documentation of source, legal compliance etc
• Stronger penalties, seizure of assets: Seizure of trucks/trailers, equipment, stockpiles of chrome

In the balance

• If the export curbs and taxes are implemented in a way that balances the interests of smelters, legal miners, government revenue, and job protection, the sector could stabilize, or even grow in its value-added side
• On the flip side, if export taxes or controls are too burdensome, or electricity tariffs remain high, some miners may scale back, shift focus, or exit, and investment could decline
• Illegal mining could reduce somewhat if oversight is effective, but socio-economic drivers (poverty, lack of employment) may mean illegal mining continues unless broader labour, land, regulatory reforms and community development are addressed
• China and Kazakhstan have grown ferrochrome capacity rapidly, taking market share once dominated by South Africa

Government tightens oversight

In a recent statement, the Department of Trade, Industry and Competition (DTIC) confirmed that "chrome ore exports will soon require permits" issued by the International Trade Administration Commission (ITAC). The draft regulation, now open for public comment, places chrome under export control, giving the state greater oversight of who exports and how much.

Officials have framed the policy as both an industrial and law-enforcement measure, aimed at countering rampant illegal chrome mining and illicit exports that have cost the fiscus billions.

“We cannot allow a strategic national resource to be stripped out of the country without oversight or beneficiation,” says Minister of Trade, Industry and Competition, Parks Tau. “Export control will help restore order to the chrome sector and rebuild confidence in legitimate operations.”

The South African Cabinet has also backed a proposal to impose a 25 % export tax on unprocessed chrome ore, part of a broader plan to keep more material in South Africa for value-added processing and job creation. The move is coupled with plans to offer electricity tariff relief and expand Special Economic Zone incentives for ferrochrome smelters - many of which have shut down due to Eskom’s soaring power costs.

Industry pushback

The Minerals Council South Africa and several chrome producers have pushed back hard against the proposed tax, warning it could have the opposite effect of what government intends.

“An export tax will not save ferrochrome. It will simply make mining less viable, reduce investment, and cost jobs,” stated the Minerals Council South Africa earlier this year.

Producers argue that the real constraint is uncompetitive electricity pricing, not the availability of ore. With a significant number of the country’s ferrochrome furnaces already offline, they say that without affordable power, smelting will remain unprofitable regardless of export curbs.

Industry analysts have also cautioned that the delay in implementing export controls, first approved in mid-2024, has allowed illegal chrome mining and smuggling to continue unchecked. Some estimates suggest that up to 10 % of South Africa’s chrome output, roughly 2.7 Mt, is being traded through black-market channels.

Balancing beneficiation and viability

The policy reflects a long-standing tension between South Africa’s desire to promote local beneficiation and the economic realities of global competitiveness. Chrome remains one of South Africa’s top mineral exports, generating around R85 billion in revenue in 2024 and employing in the region of 25 000 people directly.

While smelters welcome the government’s willingness to consider electricity relief and industrial incentives, miners warn that heavy-handed export restrictions could choke the upstream sector that feeds those same smelters.

What happens now

The ITAC public consultation period runs through the end of October 2025, after which the final export-permit system is expected to be gazetted. Implementation timelines for the proposed 25% export tax remain uncertain. As the South African government weighs its next steps, the chrome industry sits at a crossroads, between beneficiation and business survival, law enforcement and livelihoods. The outcome will determine whether South Africa can reclaim its place as a global ferrochrome powerhouse or risk further erosion of one of its most strategic mineral value chains.

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