After many months of uncertainty around whether or not ArcelorMittal South Africa (AMSA)would cease operations, it has been confirmed today, 28 February 2025 that the steel giant will shutter crucial steel mills in the country by April this year.
This comes after talks with the South African government have failed to reach a successful result and according to AMSA, the problems affecting long-steel business have worsened.
The planned closure of the loss-making long-steel operations blamed on weak domestic demand and competition from local scrap metal recycling mini-mills and imports from China, is set to impact 3500 direct and indirect jobs.
On 6 February the company unveiled a delay in the closure of long steel operations, citing talks with the government.
“The structural elements leading to the wind-down of the long-steel business remain unaddressed despite extensive discussions. We are unable to avoid what will be significant impact on the economy. Since early 2024 when negotiations began, these conditions have not merely remained static but have worsened,” AMSA said in a statement.
AMSA wanted the government to remove a tax on scrap metal exports it said it favored recyclers. It also wanted the government to impose import duties and sought to negotiate lower electricity and freight rail costs. The loss from the longs business doubled to 1.1 billion rand in 2024, from 600 million rand the year before.
ArcelorMittal South Africa CEO Kobus Venter said that the company is deeply disappointed.
“All our efforts over the last year have not translated into a sustainable solution, resulting in a significant negative impact on the economy, the loss of approximately 3500 direct and indirect jobs, and a detrimental impact on the local community in Newcastle, “he said.
The decommissioning of the blast furnace is set to commence in the fist week of March 2025 with the final steel output anticipated by late March to early April.
With the closure of AMSA Newcastle now finalised, do you think that this decision will have a direct impact on the proposed mines? Do you think that Newcastle now runs the risk of becoming a ghost town with many seeking better opportunities out of town?
Your opinion matters, drop us a comment a comment!
Disgraceful. Utterly Disgraceful. Communism will not work in SA.of course they need rural towns to become ghost towns.
Next the mining industry
Disgusting. The government only sees to self gratification.
Next the mining sector not held bi government officials