Benefits of iron ore from Kumba

Kumba Iron Ore strives to match its customers’ needs. This focus and the points below are some of the reasons that potential investors should consider project investment possibilities from Kumba Iron Ore:

• High iron (Fe) content of all products and low undersize of lump ore
• Creates less dust during handling and transportation so there is less ore loss and less impact on the environment. Also, customers receive a larger fraction of valuable lump ore.
• The product has excellent thermal shock resistance, which results in fewer fines being formed in the top of the blast furnace and therefore less fine particles are lost to the off-gas.
• The product breaks down less during reduction in the top part of the blast furnace. This means there is lower fines formation in the blast furnace, which increases permeability of the burden and less coke is needed.
• Increased sinter plant productivity as a result of a coarser fine ore, so this counters the finer sinter feed material in the market, thereby increasing permeability

Higher iron ore grades are necessary for the automotive and construction markets, as well as other demanding, specialised infrastructures. This bodes well for Kumba Iron Ore. Its export sales to China accounted for 61% of the company’s total exports. The rest of Asia accounted for 19% and the export figure to Europe was 12% for financial year 2017.

Shareholders and exports

A member of the LSE-listed Anglo American, Kumba Iron Ore exports to China, Japan, Korea, India and numerous European and Middle Eastern countries, among others. The company is a leading value-adding supplier of high quality iron ore, with mining operations concentrated in South Africa’s Northern Cape and Limpopo Provinces.

Initially listed on the Johannesburg Stock Exchange (JSE) as Kumba Resources in 2001, the company was reorganised in 2006 when coal and heavy minerals operations were spun off to create Kumba Iron Ore (heavy minerals) and Exxaro Resources (Coal). The company then listed on the JSE that same year under the name Kumba Iron Ore, with a market capitalisation of R36 billion.

The company’s production process consists of exploration, planning and building, mining, processing and blending, shipping, marketing, and selling.

As far as the shareholding in Kumba Iron Ore is concerned, Anglo American plc is the majority shareholder with a 63.4% stake, the Industrial Development Corporation of South Africa owns 13.1% and the remaining 23.5% is held by minority shareholders.

Kumba Iron Ore, in turn, owns a 73.9% interest in Sishen Iron Ore Company Pty (Ltd) (SIOC). The remaining 26.1% is held by 3 entities, broad-based black economic empowerment (BBBEE) shareholders – Exxaro Resources (19.98%), the SIOC Community Development Trust (3%) and Envision, an employee share participation scheme (3.1%).

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