Jul 13, 2012
Cottage, secondary steel industries hold biggest growth potential – ISFBack
Construction|Engineering|Africa|Components|Environment|Ghana|Housing|Industrial|PROJECT|Projects|Renewable Energy|Renewable-Energy|Vital Engineering|Africa|Angola|Australia|Canada|Ghana|Malawi|South Africa|Tanzania|Uganda|Cottage Steel Industries|Cottage Steel Industry|Cottage Steel Sector|Energy|Equipment|Local Light Steel Frame|Local Manufacturer|Local Secondary Steel|Maintenance|Manufacturing|Mining|Products|Secondary Steel Industries|Secondary Steel Industry|Secondary Steel Products|Secondary Steel Supply|Steel|Steel Components|Steel Industry|Steel Sector|Structural Steel Mining Contracts|Transport|EPCM|Dodds Pringle|Fabrication|Maryland|Wind Farm Technology
© Reuse this
Since its inception in 1991, one of the primary goals of the ISF has been to drive exports of locally fabricated secondary steel products for the international market. Pringle believes this goal can be achieved by further developing the cottage steel industry, which, in turn, entails encouraging local community members to use raw materials and their own equipment to fabricate steel components and products.
“While we are seeing the bigger picture in trying to secure structural steel mining contracts [for ISF members] in countries like Canada and Australia, as well as the rest of Africa, we are also considering the development of the cottage steel sector, with a possible future for exports in mind,” he says.
He adds that the unregulated environment of a small-scale sector enables local entrepreneurs to manufacture high-quality products at a relatively low cost, which provides endless possibilities for South Africans, such as job creation, wealth creation and new-enterprise developments.
“[The cottage sector] might be relatively small in terms of the [steel] industry as a whole, but we could probably start developing it into a fairly large industry if we start sector by sector, area by area,” says Pringle. He maintains that this could easily lead to a future in exports for previously unemployed individuals, and cites Uganda, Tanzania, Malawi, Angola and Ghana as examples of countries that are successfully promoting their cottage steel industries.
Pringle believes South Africa has many potential entrepreneurs who are artistically inclined. “They work wonders with steel and have the incredible ability to create things of beauty.”
He adds, that, although the ISF has partly achieved its goal to drive exports, there is still a lot of work to be done in terms of understanding the international market, particularly in the secondary steel industry.
This sector of the industry needs to work at developing a higher level of confidence and faith in South African secondary steel supply. “We hope that the secondary steel industry will take more of a pole position in terms of exports,” says Pringle.
Latest Industry Trends
Pringle cites the recently established local light steel frame (LSF) housing industry as an example of an upcoming secondary steel industry.
He points out that, traditionally, South African steel has always been associated with the industrial environment, but interest in the use of this material is growing in the commercial sector. “[LSF] buildings are fairly easy to transport and erect; they also require a lot less maintenance,” he says, adding that the added benefits of LSF buildings far outweigh those of traditional brick and mortar buildings.
This relatively new industry has already started exporting products to the rest of Africa.
Meanwhile, the ISF has encouraged investment in wind farm technology and promoted partnerships with overseas companies to develop wind towers for the expansion of South Africa’s renewable-energy sector. “A lot of that fabrication will be done in South Africa, rather than importing [the towers],” says Pringle.
The local steel industry is developing new steels that will be able to manage the particular loads on the wind towers, he says. As a result, there are a variety of steel grades that are now being upgraded from traditional standards to 350, 400 and 500 WA materials.
“Improving our grades of steel to international standards enables us to improve on production and design, and to keep up with international design trends,” he notes.
Pringle stresses that, from a strength and performance perspective, the grade of steel that the South African industry is using at the moment is equal to any other steel produced globally. “So, from a downstream competitive perspective, our steel industry can compete fairly favourably with international projects,” he says.
Once the establishment of the wind tower industry in South Africa has been completed, it will be logical for this industry to also start looking north beyond South Africa’s borders for new opportunities in neighbouring countries, he adds.
“Government recently announced the new Manufacturing Competitiveness Enhancement Programme, which is very positive,” says Pringle. He adds, however, that if preventive measures for the South African secondary steel industry are not implemented now, steel business could soon start to move offshore, which has happened in other countries, like Australia.
As head of the ISF, Pringle has suggested that government consider placing import duties on all finished steel goods, but not on raw steel. “This would allow us to become a focused converter of internationally competitive raw materials, which will further improve our competitiveness,” he says, adding that it might also meet some of government’s goals for job creation, wealth creation and growth in the industry.
The ISF is also part of a current movement to establish ‘South Africa Incorporated’, also referred to as SA Inc, which would aim to bring together the various South African construction industries as one unit for the export markets. This would provide international customers with a holistic view of the country, compared with viewing local companies as individual entities.
“Traditionally, you find that a particular engineering, procurement and construction management (EPCM) company would secure a portion of a contract for a particular plant or project, but would be isolated,” explains Pringle. However, if that EPCM was part of a corporation like SA Inc, more than one local company could be involved and would benefit from a single project.
Pringle also stresses the importance of international confidence in South Africa and suggests that government do what it can to mitigate any lack of confidence in the local industry, which will, hopefully, boost the state of the industry in the long run.
Edited by: Chanel de Bruyn© Reuse this Comment Guidelines (150 word limit)
Other Carbon Steel News
Article contains comments
The detailed feasibility study into a $4.5-billion, two-phase steel project planned for development by the Hebei Iron and Steel Group, of China, and South Africa’s Industrial Development Corporation (IDC) should be completed in the first quarter of 2015, IDC CEO...
JSE-listed African Oxygen (Afrox) has signed a ten-year extension for the supply of 50 t/d of oxygen to steel and steel products manufacturer Scaw Metals Group’s Wadeville works, in Gauteng. Afrox said the new agreement, encompassing previous updates of old...
Article contains comments
Trade and Industry Minister Dr Rob Davies confirmed on Friday that the Hebei Iron and Steel Group, of China, was set to partner with the State-owned Industrial Development Corporation (IDC) on the development of steelmaking capacity based on the raw material...
Updated 44 minutes ago A series of unfortunate events led to Johannesburg and surrounding areas experiencing significant water shortages over the past week, City of Johannesburg mayoral committee member for development planning and urban management Roslynn Greeff said at a media briefing...
Updated 1 hour 7 minutes ago Based on reports submitted to National Treasury, municipalities owe water boards some R2-billion, Cooperative Governance and Traditional Affairs Minister Pravin Gordhan revealed in a written response to a Parliamentary question on Monday. Municipalities in the Free...
Updated 1 hour 21 minutes ago South African cement group PPC CEO and director Ketso Gordhan has resigned with immediate effect as a result of a “difference of opinion” with the board regarding board procedures for the approval of certain decisions. Nonexecutive chairperson Bheki Sibiya would now...
Recent Research Reports
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
This Week's Magazine
While Ekurhuleni-based transformer manufacturer Reliable Transformers currently designs, manufactures and tests its products according to the SANS 780 specifications for distribution transformers and other applicable transformer specifications, it is working towards...
Global endpoint security solutions company Kaspersky Lab has introduced new measures to prevent cyber criminals from accessing sensitive data, alongside its malware-signature and heuristic device analysis detection methods. Threats to mobile devices have increased...
To ensure uptake and a positive impact, Wireless Fidelity (Wi-Fi) networks in cities must be provided at schools, community centres and commercial centres to enable citizens and government to access information that will improve access to and delivery of services....
Eco-estate Monaghan Farm, located near Lanseria airport, north-west of Johannesburg, has taken a new approach to modern living and sustainability with its 517 ha development, dedicated to farm living.
Forklift and lift-truck distributor Goscor Lift Hi-Reach launched the Genie SX-180, the tallest self-propelled super boom in Africa, in Johannesburg last month. “As the official distributor of the well-known Genie range of equipment in Southern Africa, we are pleased...