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Johannesburg - Arcelormittal South Africa (Amsa), Africa's biggest steel producer, reported on Thursday that its operating and headline losses for the half year to June had increased by R714 million and R1.16 billion respectively.

The company blamed higher coking coal and iron ore costs coupled with the strengthening of the rand against the dollar as well as the weakening of the South African economy for the weak financial results.

Amsa chief executive, Wim De Klerk, said the results were on the back of the weaker domestic economy.

Read also: ArcelorMittal SA cuts headline loss by R2.78bn 

"Declining business confidence as a result of the recession, a 0.7 percent decrease in gross domestic product during the first quarter of 2017, a downgrade to junk status and the highest unemployment rate since 2004 are all contributing factors to a weakened economy in South Africa,” said De Klerk.

“In turn, this has resulted in minimal local investment and infrastructural spend, particularly in the construction and manufacturing sectors, and it has seriously constrained the local steel market.” 

BUSINESS REPORT ONLINE