London-listed ferrochrome producer International Ferro Metals (IFM) says it will restart its second furnace at the Buffelsfontein smelting and mining operation, in South Africa’s North West province, in mid-August, as demand from the Chinese steel industry increases.

“IFM has watched carefully the development of the global ferrochrome market and the board has decided the time is right to restart production to serve the increased demand from China, where the steel industry is now operating at near capacity. The strength of our relationships in China and the resumption of production, place us in good stead for the future,” CEO David Kovarsky said in a statement on Thursday.

The producer shut down its two South African furnaces in November last year in response to falling global demand.

However, Kovarsky has in recent months reported signs of improvements in the ferrochrome market, reporting just last week that the demand and spot prices for ferrochrome had increased “noticeably” in the past few weeks, as a result of the Chinese stimulus programme and low ferrochrome inventories.

The company had restarted the first of its furnaces in mid-April, initially to convert its raw material inventory to finished product to contribute towards fixed overheads.

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Both furnaces were expected to reach a 90% capacity level by September, in line with its power supply from South African power utility Eskom.

The company’s openpit mine, which had been operating at reduced levels, would also be ramped up to full capacity of 35 000 t/m of ore within the next six weeks.

Further, IFM would also resume underground mining operations and was preparing tender documents for the recommissioning of the existing Lesedi shaft.