The Supply Situation of Aggregates and Sand

The issuing of licenses for the mining of aggregates and sand is of critical importance to the construction sector and the economy in general, said Nico Pienaar, Director of the Aggregate and Sand Association of South Africa (ASPASA).

ASPASA welcomed the recent announcement by Minister of Mines and Mineral Affairs to radically simplifying and making the mineral licensing allocation process more transparent.

Pienaar said that not many realised that between 70 to 80 percent of the volume of concrete and between 90 and 95 percent of blacktop used on roads consisted of aggregates.  Without a reliable and adequate aggregate supply, the construction of roads, bridges, dams, housing or power stations are impeded. The provision of infrastructure unlocks economic development. In the United States of America aggregate usage is 10 tons per person per year compared to 2 tons per person per year in South Africa.

Aggregate and sand producers in South Africa are however facing several challenges in the form of many illegal mining operations. These sometimes substantial mining and manufacturing of aggregates and sand frequently do not comply with applicable labour, health and occupational safety legislation as well as causing considerable damage to the environment. As result of their non-compliance, these illegal operators are able to produce at a lower cost than the legitimate licensed mining and manufacturing aggregate and sand concerns.

Currently, it may take two to three years to obtain a mining licence and these delays are frequently the cause of the illegal mining operations. According to the CEO of a large JSE listed group that also produces aggregates, an enterprise submitting a mining license application is obliged to provide a great deal of additional information and data with their submission and he suspected that this was sometimes leaked to others by officials employed in the Regional Offices of the Department of Mining and Mineral Affairs. The same information and data is then used to make application for mining licenses for adjacent or nearby sites. The withdrawal of the new applications is then used as a bargaining tool in exchange for money.

Pienaar confirmed this and said it was a standing joke in the industry that business leaders were frequently approached by those who said: "Give me a 4x4, and I will get you a mining license”.

What ASPASA was seeking is structure and discipline in the industry to ensure an adequate aggregate and sand supply to satisfy the infrastructure requirements of South Africa.

Pieter Rautenbach