ArcelorMittal: long steel production ceases in South Africa

(CercleFinance.com) - ArcelorMittal announced on Monday that it had decided to discontinue its long steel production activities in South Africa, faced with economic conditions deemed too unfavorable.


The steelmaker justifies its decision by the influx of cheap Chinese steel imports into the country, as well as rising energy prices and logistics costs.

Persistent overcapacity in the market, both globally and locally, and far too low international steel prices have exacerbated the entity's structural difficulties', explains the group.

According to its calculations, steel imports into the country have soared by almost 50% since 2018, while exports have fallen by 40% over the same period.

ArcelorMittal South Africa, which plans to cease manufacturing long products by the end of January, says its capacity utilization rate was down to just 50% in the face of the current market weakness.

The decision is set to affect around 3,500 direct and indirect jobs, the company says.

For FY 2024, the steel giant's South African subsidiary expects to see its annual loss per share widen to between 5.48 and 6.21 rand, compared with a shortfall of 3.52 rand in 2023.

Listed in Paris, ArcelorMittal shares lost 0.5% in early trading on Monday morning, compared with a gain of around 0.6% for the CAC 40 index.


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