ArcelorMittal South Africa announced on November 11 that it would be closing Saldanha Steel. Photo: Simphiwe Mbokazi/African News Agency (ANA)

JOHANNESBURG – South African steel production fell by 7.6 percent year on year in October to an estimated 502 000 tonnes according to the World Steel Association (worldsteel).

Global steel production dropped by 2.8 percent year on year.

In the first five months, South African steel production had still grown by 1.1 percent year on year, but from May onwards there have been a series of double-digit declines.

In May the drop was 10.3 percent, followed by 17 percent in June and then 13.2 percent in July. The decline in the first 10 months is now 6.7 percent year on year.

In 2018 South African steel production grew by only 0.4 year on year to 6.3 million tons, the second consecutive year it was less than Egyptian production, which rose by 13.6 percent to 7.8 million tonnes.

ArcelorMittal SA (AMSA) said it might close loss-making plants and production areas following a review after it reported a R222 million operating loss in the six months to June. AMSA has operations in Vanderbijlpark, Vereeniging, and Newcastle.

AMSA announced on November 11 that it would be closing Saldanha Steel.

The Minister of Trade and Industry, Ebrahim Patel, urged AMSA to continue working with the government and other social partners to reverse this decision and find solutions which would keep Saldanha Steel producing and its workers in employment.

The Department of Trade, Industry and Competition (DTIC) has received expressions of interest by two parties who want to buy the Saldanha Steel works.

“We are encouraged by these early expressions of interest in Saldanha Steel,” Patel said.