Ferrochrome production volumes fell by 4% in the first half of 2011 compared to the first six months of 2010, due to a number of furnace refurbishments that were brought forward into the first half. Maintenance activities focused largely on the more efficient Premus furnaces, resulting in lower consumption efficiencies and increased production costs.

The ferrochrome benchmark price rose from USD 1.25 per pound in the first quarter to USD 1.35 per pound in the second quarter, falling by 11% in the third quarter to USD 1.20 per pound due to weak demand and destocking in Europe and lower demand in China.

Ferrovanadium production volumes decreased by 10% compared to the first six months of 2010, due to a planned two week maintenance shutdown. Some vanadium pentoxide for ferrovanadium conversion was redirected towards direct vanadium pentoxide sales to benefit from more favorable market conditions.

Permitting delays and blasting restrictions for the current open pit operation at Eland resulted in lower PGM volumes in the first half of 2011. Mining recommenced in the second quarter, although the disruption to the mining plan has resulted in a delayed production build up at the eastern pit. The Mototolo joint venture maintained nameplate ROM production of around 200,000 tonnes per month throughout the period.

The development of both decline shafts at the Eland underground development is progressing well with a total of 7,650 meters developed to date and the bulk of the surface infrastructure completed. Initial production from the first operating level of the western decline, the Kukama shaft, is expected during the fourth quarter of 2011, following the completion of the first phase of the underground ore handling conveyor belt infrastructure.