ArcelorMittal SA’s Vereeniging long steel plant will no longer close

VEREENIGING - ArcelorMittal South Africa (Amsa) has decided to halt the closure of its long steel product operations at plants in Vereeniging, Vaal Triangle, and Newcastle, KwaZulu-Natal, saving 3,500 jobs. In January, the world's No 2 steelmaker delayed the closure of the business by up to six months as it engaged government and labour to resolve issues affecting its profitability and to avert job losses. Amsa said in a trading update that the board and management have decided the long steel business will continue to operate to allow an opportunity for the short, medium and longer-term initiatives aimed at securing its sustainability to be fully explored. Announcing the planned closure last November, Amsa blamed weak demand and persistent infrastructure problems in Africa's most advanced economy. The steelmaker also bemoaned policies which gave scrap metal an advantage over iron ore in steel production.

The company on Monday noted improvements in electricity generation as well as port and rail efficiencies. Amsa further said the non-renewal of a steel scrap export ban after it expired in December 2023 had also started to bring “greater fairness and equity into the input cost structures” between integrated steelmakers such as ArcelorMittal and scrap-based producers. It has also obtained a R1 billion working capital facility to support continued operations.

PHOTO: (Supplied)