Low demand for product and low prices since 2012 has led to losses for three consecutive years despite average revenues topping Sh2.35billion/FILE
NAIROBI, Kenya, Feb 18- Kenya Fluorspar Company has once again announced suspension of its operations starting April 30 this year.
Managing Director Nico Spangenberg says closure of the company is as a result of a prolonged slump in global commodity prices which has impacted the company’s performance.
Low demand for product and low prices since 2012 has led to losses for three consecutive years despite average revenues topping Sh2.35billion.
“Unfortunately, a collapse of the market in the last six months has led to a dramatic reduction in fluorspar prices and demand and thus the company’s operations have become unsustainable in the current market,” the MD said in a notice on Thursday.
The company has said it remains committed to work but cannot predict when operations will resume as this will depend on recovery in global markets.
This is the second time in less than a year that the company is closing shop.
In June last year the firm halted its processing operations citing weak global demand for fluorspar and the commodity’s depressed prices, but resumed later in August 2015.At the time, the company cut its annual production to 77,000 metric from an earlier estimate of 95,000 tons.
With this closure, over 75 employees across all levels will be sent home but with assurance that they will all get their set send off packages.
“Today’s announcement will unfortunately result in the termination of employment of employees across all level of staff. All agreements will be respected and wages and dues paid in full,” he said, “In the future when the company becomes financially sustainable to resume operations, current employees will receive preference in re-employment.”
The closure of the company is seen a major hit to the current Sh1.2 billion mining industry that has already set a target of Sh200 billion in ten years’ time.
It has been one of the few large-scale mining and metallurgical operations in Kenya and ranks as one of the country’s leading foreign exchange earners.
