ArcelorMittal South Africa said it is still on track to close its loss-making long steel operations in September, as talks with the government have not provided a solution.
Image credit: Reuters
The steelmaker also posted a half-year headline loss of R1.014bn, slightly narrower than a R1.1bn rand loss reported previously, on persistently low sales volumes and low prices.
Its revenue fell 17% to R17bn, and sales volumes declined 11% to 1.05 million metric tonnes due to weak demand from key steel-consuming sectors in South Africa.
ArcelorMittal South Africa is in talks to defer long steel plant closure
ArcelorMittal South Africa has twice deferred the closure of its long steel plants in Newcastle and near Johannesburg, initially announced in November 2023, to allow talks with the government aimed at saving 3,500 direct jobs.
“In the absence of a sustainable solution, the final wind-down of the longs business remains scheduled for 30 September 2025,” the company said in a statement.
South Africa’s trade and industry minister, Parks Tau, told lawmakers on 4 July that the government was in ‘firefighting mode’ as it tries to avoid the plant closures.
Govt in ‘firefighting mode’ to save ArcelorMittal’s 3,500 jobs
The company says its long steel operations are buckling under the pressure of weak local demand, high electricity tariffs, poor freight logistics, competition from local scrap metal recycling mini-mills and imports from China.
The long steel plants supply rail, roads and bars to the construction, mining and manufacturing sectors, as well as components for the automotive industry.
