ArcelorMittal South Africa delays long-steel plant closure amid government talks
The company had planned to start winding down the loss-making long-steel business by the end of last month, but has delayed it due "continuing discussions with the South African government" as well as higher-than-anticipated orders.
The outcome of the talks will be announced before the end of this month, the steelmaker said in a statement.
The company stated that a 380 million rand ($20.44 million) loan from the Industrial Development Corporation of South Africa, its second-largest shareholder after parent company ArcelorMittal (MT.LU), opens new tab, has facilitated the continued operations of its long-steel business.
ArcelorMittal South Africa also reported a headline loss of 5.1 billion rand for the year ended December 31, wider than the headline loss of 1.89 billion rand in 2023.
The company said the losses were mainly driven by the weak financial performance of its long steel business on the back of soft demand, high energy and logistics costs, as well as the influx of low-cost steel imports, particularly from China.
The closure of the long-steel operations, which produce fencing material, rail, rods and bars used in the construction, mining and manufacturing sectors, has been on the cards since November 2023. The shutdown could affect about 3,500 direct and indirect jobs.
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