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Manufacture Explosives Pyrotechnics Industry South Africa

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2020

Yasmin Mahomedy | South Africa | 11 February 2020

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2018

Yasmin Mahomedy | South Africa | 29 November 2018

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2015

Amanda van der Westhuizen | South Africa | 20 October 2015

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Introduction

This report focuses on the manufacture of explosives and pyrotechnics. The explosives market is largely dependent on the mining industry, which is losing global competitiveness due to increasing costs, strike action, regulatory and operational challenges, and unstable electricity supply. Demand for more cost-effective solutions remains high and the major explosive companies continue to focus on product enhancements that will lead to mine production improvements and blast optimisation. Innovation by some companies has led to international interest in underground blasting technology while other companies have been exploring opportunities outside South Africa.

Strengths

• Strict regulation of the industry ensures high standard of product quality and safety.
• Vigorous competition drives product development and innovation.

Weaknesses

• High costs and limited skills for the strict regulation, for safety reasons, of explosives in terms of transport, storage and usage.
• The explosive and drilling industry is very capital-intensive.
• The market is dominated by a few large producers which makes it difficult for smaller companies to enter.

Opportunities

• Growth in other countries through the introduction of new technologies.
• Weakening of the rand has a positive impact on export earnings.

Threats

• Inadequate supply of technical skills limits expansion of the industry.
• Load shedding and insecure energy supply increases production costs and places pressure on margins.
• Slow-down of activity in the mining industry reduces demand for explosives.
• The development of new mining technologies and equipment could reduce the demand for explosives.

Outlook

The outlook for the explosives industry remains challenging as the mining sector battles with low business confidence, production declining, insecure electricity supply, labour issues and volatility across all mineral commodities. As a result, companies such as BME will continue looking for new opportunities outside South Africa. BME’s Hennecke said: “With foreign direct investment down, investor confidence eroding, infrastructure constraints, and ever-increasing mining input and utility costs, there are few prospects of new mining operations unfolding. This limits the explosives market.”

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2020

Full Report

R 1 900.00(ZAR) estimated $99.65 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 69.76 (USD)*

Historical Reports

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2018-11-29

R 1 900.00(ZAR) estimated $99.65 (USD)*

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Manufacture of Explosives and Pyrotechnics Industry in South Africa 2015-10-20

R 1 900.00(ZAR) estimated $99.65 (USD)*

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Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 3
3. SIZE OF THE INDUSTRY 3
4. STATE OF THE INDUSTRY 4
4.1. Local 4
4.1.1. Corporate Actions 6
4.2. Regulations 6
4.2.1. Enterprise Development and Social Economic Development 7
4.3. Continental 8
4.4. International 9
5. INFLUENCING FACTORS 10
5.1. Mining Industry Activity 10
5.2. Economic Environment 10
5.3. Government Initiatives 11
5.4. Electricity Supply 11
5.5. Technology, R&D and Innovation 11
5.6. Labour 13
5.7. Environmental Concerns 15
6. COMPETITION 16
6.1. Barriers to Entry 16
7. SWOT ANALYSIS 17
8. OUTLOOK 17
9. INDUSTRY ASSOCIATIONS 18
10. REFERENCES 18
10.1. Publications 18
10.2. Websites 18
APPENDIX 1 20
Summary of Notable Players 20
COMPANY PROFILES 22
AECI MINING SOLUTIONS LTD 22
DENEL SOC LTD 25
DETNET SOUTH AFRICA (PTY) LTD 30
LION MATCH PRODUCTS (PTY) LTD 32
MAXAM DANTEX SOUTH AFRICA (PTY) LTD 34
MINOVA AFRICA (PTY) LTD 36
NXCO MINING TECHNOLOGIES (PTY) LTD 38
OMNIA GROUP (PTY) LTD 40
SASOL DYNO NOBEL (PTY) LTD 43
SOLAR MINING SERVICES (PTY) LTD 45
ZIMCO GROUP (PTY) LTD 47

Introduction

This report focuses on the manufacture of explosives and pyrotechnics. The explosives market is largely dependent on the mining industry, which is slowly recovering from the slump of the past few years. The value of the South African mining explosives industry increased from $12.9bn in 2014 to $14bn in 2017, despite challenging conditions. Demand for more cost-effective solutions has prompted the major explosive companies to become more innovative in their product offerings. This has also opened up opportunities to diversify internationally. As mentioned, the primary market for dynamite is the mines, and the history of this industry is closely linked to that of mining going back to the late 1890s when president Paul Kruger governed the Zuid Afrikaanse Republiek (ZAR), which was given independence by the British after the first Boer War. Much to the irritation of the British, soon after them granting independence, massive gold deposits were discovered on the Witwatersrand which formed part of the ZAR. Kruger saw the opportunity of controlling the supply of dynamite and established the state-owned dynamite manufacturing monopoly with its plant at Modderfontien which dictated the price of dynamite and was effectively another tax on the mining companies. The dissatisfaction amongst the mainly British miners lead to the failed Jameson Raid and later the second Boer War.

Strengths

• Strict regulation of the industry ensures high standard of product quality and safety.
• Vigorous competition drives product development and innovation.

Weaknesses

• High costs and limited skills for the strict regulation, for safety reasons, of explosives in terms of transport, storage and usage.
• The market is dominated by a few large producers which makes it difficult for smaller companies to enter.

Opportunities

• Growth in other countries through the introduction of new technologies.
• Weakening of the rand has a positive impact on export earnings.

Threats

• Inadequate supply of technical skills limits expansion of the industry.
• Load shedding and insecure energy supply increases production costs and places pressure on margins.
• Slow-down of activity in the mining industry reduces demand for explosives.
• The development of new mining technologies and equipment could reduce the demand for explosives.

Outlook

The outlook for the industry is expected to be challenging. With the country in a recession, the mining sector still slowly recovering amidst labour issues and rising input costs, the demand for explosives is expected to be subdued. BME expects tough trading conditions to continue in the South African market and it will continue internationalising its footprint to exploit new opportunities. Companies are expected to continue to improve their products and services to ensure that products add value for customers who are looking for solutions to drastically reduce mine operating costs. BME said that “the recovery and future of the industry relies on optimal value creation at every step in that chain”.

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2018

Full Report

R 1 900.00(ZAR) estimated $99.65 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 69.76 (USD)*

Historical Reports

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2020-02-11

R 1 900.00(ZAR) estimated $99.65 (USD)*

View Report Add to Cart

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2015-10-20

R 1 900.00(ZAR) estimated $99.65 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 3
3. SIZE OF THE INDUSTRY 3
4. STATE OF THE INDUSTRY 4
4.1. Local 4
4.1.1. Corporate Actions 6
4.1.2. Regulations 6
4.1.3. Enterprise Development and Social Economic Development 7
4.2. Continental 8
4.3. International 9
5. INFLUENCING FACTORS 10
5.1. Mining Industry Activity 10
5.2. Economic Environment 10
5.3. Government Intervention 10
5.4. Electricity Supply 10
5.5. Technology, Research and Development (R&D) and Innovation 11
5.6. Labour 12
5.7. Environmental Concerns 14
6. COMPETITION 15
6.1. Barriers to Entry 15
7. SWOT ANALYSIS 16
8. OUTLOOK 16
9. INDUSTRY ASSOCIATIONS 17
10. REFERENCES 17
10.1. Publications 17
10.2. Websites 17
APPENDIX 1 19
Summary of Major Players 19
COMPANY PROFILES 24
AECI MINING SOLUTIONS LTD 24
DENEL SOC LTD 27
DETNET SOUTH AFRICA (PTY) LTD 31
LION MATCH PRODUCTS (PTY) LTD 33
MAXAM DANTEX SOUTH AFRICA (PTY) LTD 36
MINOVA AFRICA (PTY) LTD 38
NXCO MINING TECHNOLOGIES (PTY) LTD 40
OMNIA GROUP (PTY) LTD 42
SASOL DYNO NOBEL (PTY) LTD 45
SASOL SOUTH AFRICA LTD 47
ZIMCO GROUP (PTY) LTD 50

Report Coverage

This report describes the current situation in the country, examines the increasingly competitive market and focuses on factors influencing the sector’s success. The report also profiles eleven companies, including Bulk Mining Explosives (BME) which is part of the Omnia Group, and the country’s leading explosives company, African Explosives Ltd (AEL) Mining Services, which held approximately 60% of the domestic market in 2013.

Introduction

This report focuses on the manufacture of explosives and pyrotechnics. The industry supplies explosives mainly to the mining industry. According to Bulk Mining Explosives (BME), the mining explosives and pyrotechnics manufacturing industry is worth approximately R5bn annually. Industrial action in the mining industry combined with lower global commodity prices in recent years had a significant knock-on effect on the industry. To adapt, companies are offering more diverse products and exploring new markets. In particular, the industry’s focus has shifted to the mining industry in other African countries. Environmental and safety concerns as well as technological advancements are key drivers of innovation in this fiercely competitive industry.

Strengths

• Strict regulation of the industry ensures high standard of product quality and safety.
• Vigorous competition drives product development and innovation.

Weaknesses

• High costs and limited skills for the strict regulation, for safety reasons, of explosives in terms of transport, storage and usage.
• The market is dominated by a few large producers which makes it difficult for smaller companies to enter.

Opportunities

• Growth in the African mining and civil engineering industries which requires explosives.
• There will be opportunities for companies that provide explosives for open-cast mining because of demand for coal from Eskom’s new coal-fired power stations.
• Weakening of the Rand has a positive impact on export earnings.

Threats

• Difficulty to secure an adequate supply of raw materials and the rise of the price of raw materials threatens margins and ability to honour supply contracts.
• Inadequate supply of technical skills limits expansion of the industry.
• Load shedding and insecure energy supply increases production costs and places pressure on margins.
• Slow-down of activity in civil engineering, construction and mining industries reduces demand for explosives.
• The development of new mining technologies and equipment could reduce the demand for explosives.

Outlook

It is expected that the industry will grow at a CAGR of 5.2% up to 2020, largely due to improved production from coal, iron ore and copper mining activities. Factors such as uncertainty regarding the outlook for the global economy and demand for commodities require companies to be flexible with business models and strategies to adapt to the needs of their clients as well as their operating environments. Industry sources said product innovation and technological advancements, as well as market expansion into Africa and other emerging economies, would provide new opportunities for the explosives industry. Domestic demand for coal is expected to grow in the medium term as Eskom’s new power stations come on-line thus opening up opportunities for explosives for open-cast mining.

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Manufacture of Explosives and Pyrotechnics Industry in South Africa 2015

Full Report

R 1 900.00(ZAR) estimated $99.65 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 69.76 (USD)*

Historical Reports

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2020-02-11

R 1 900.00(ZAR) estimated $99.65 (USD)*

View Report Add to Cart

Manufacture of Explosives and Pyrotechnics Industry in South Africa 2018-11-29

R 1 900.00(ZAR) estimated $99.65 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 2
3. SIZE OF THE INDUSTRY 3
4. STATE OF THE INDUSTRY 7
4.1. Local 7
4.1.1. Regulations 9
4.1.2. Enterprise Development and Social Economic Development 10
4.2. Continental 10
4.3. International 12
5. INFLUENCING FACTORS 13
5.1. Economic Environment 13
5.2. Mining and Construction Industries Activity 13
5.3. Government Intervention 14
5.4. Raw Material Security 15
5.5. Uncertain Electricity Supply 15
5.6. Labour 15
5.7. Technology 17
5.8. Research and Development (R&D) and Innovation 18
5.9. Environmental Concerns 18
6. COMPETITION 18
6.1. Barriers to Entry 19
7. SWOT ANALYSIS 19
8. OUTLOOK 20
9. INDUSTRY ASSOCIATIONS 21
10. REFERENCES 21
10.1. Publications 21
10.2. Websites 22
COMPANY PROFILES 23
AEL HOLDCO LTD 23
DENEL SOC LTD 27
DETNET SOUTH AFRICA (PTY) LTD 33
LION MATCH PRODUCTS (PTY) LTD 35
MAXAM DANTEX SOUTH AFRICA (PTY) LTD 37
NXCO MINING TECHNOLOGIES (PTY) LTD 39
OMNIA GROUP (PTY) LTD 41
ORICA MINING SERVICES SOUTH AFRICA (PTY) LTD 44
SASOL DYNO NOBEL (PTY) LTD 46
SASOL SOUTH AFRICA (PTY) LTD 48
ZIMCO GROUP (PTY) LTD 53
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