Exxaro Resources faces challenges from rail disruptions and coal demand decline

EXXARO Resources' immediate challenges includes South Africa's rail infrastructure, a decrease in coal demand from Eskom as well as the uncertainty created by the impending expiry of a 90-day import tariff reprieve granted by the US.

- EDWARD WEST

Trade regulatory uncertainty has moderated since April, positively impacting financial and commodity markets. Equity indices, crude oil prices, and the US dollar rebounded, said Riaan Koppeschaar, CFO of the coal, iron ore mining, and renewable energy group, in a pre-close statement released on Monday.

However, the 90-day reprieve on increased US import tariffs on South African goods is set to expire on July 9, 2025. During this period, South African exports to the US are subject to a 10% tariff instead of the previously announced 30%.

Koppeschaar noted that while South Africa's real GDP began the year slowly, with a 0.1% quarter-on-quarter expansion, there is optimism that economic activity will improve in 2025, despite the uncertain trade outlook.