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SA steel industry on the ‘brink of implosion’

Home Metals SA steel industry on the ‘brink of implosion’

LOCAL steel manufacturer Duferco Steel Processing raised the red flag over the local steel industry, saying its imminent collapse is one fateful step closer.

Managing Director Ludovico Sanges said President Ramaphosa’s emphasis in his recent State of the Nation Address on the need to accelerate South Africa’s economic recovery and grow jobs was at odds with the way in which local steel manufacturers’ pleas for help are being ignored.

He said Ramaphosa had specifically mentioned steel as one of the 42 products that can be sourced locally.

“But the local industry is on the brink of catastrophe due to the shortage of steel in South Africa and the apparent unwillingness of the International Trade Administration Commission (ITAC) to treat our urgent application for assistance dating from July 2020 with any seriousness.”

While ITAC recently sent out a survey on the shortages, based on a directive from the Minister of Trade, Industry and Competition, “the truth is that we cannot hold out too much longer”.

He said the commission had sent similar requests to the industry before, claiming that the latest one was merely a delaying tactic, “which does nothing to address ArcelorMittal South Africa’s anti-competitive and monopolistic behaviour”.

“The solution, which has been on the table for months, is to provide tariff relieve for re-rollers to help reduce the shortages in the local steel supply chain, yet ITAC’s drive to identify a new solution does not address the critical downstream shortages.  We need tariff relief now to be able to import the raw product that AMSA cannot supply reliably and competitively, to feed the downstream steel industry with the product it needs.”

“Without competition in the re-roller sector of the steel industry, the whole steel value chain will be compromised and prevented from producing product at the best possible price.”

He said government had shown that it was able to play a positive role in nurturing the automotive and sugar industries. “Why is it not taking the same proactive approach to the steel industry on which multiple industries rely?”

 

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