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Apr 14, 2008

State still studying viability of new steel plant - Mpahlwa

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Africa|Industrial|Africa|Building|Steel|Fabrication|Iron Ore|Iron-ore
Africa|Industrial|Africa|Building|Steel|Fabrication|Iron Ore|Iron-ore
africa-company|industrial|africa|building|steel|fabrication|iron-ore|iron-ore-person
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Feasibility studies to determine the viability of building a State-initiated carbon-steel plant to rival ArcelorMittal South Africa and Highveld Steel, were still under way, Minister of Trade and Industry Mandisi Mpahlwa told journalists at a briefing on Monday.

"I do know that there are various initiatives that are under way, all of which are aimed at assisting us in terms of availability of steel perhaps much cheaper grades than we are able to get currently from Mittal," Mpahlwa added.

Bloomberg News reported that the feasibility study, which was being overseen by the State-owned Industrial Development Corporation (IDC), would likely be complete in September.

Mpahlwa also noted that there was also "an initiative that we [South African government] have with Mozambique, to establish an iron and steel complex that will stretch between two of our provinces, Limpopo and Mpumalanga, as well as the southern part of Mozambique."

He added that it was an important initiative between the two countries, and that the Department of Trade and Industry continued to do work in a broad number of areas regarding the steel industry in South Africa.

"But, I think that the conclusiveness really as to whether a second steel facility is feasible and viable - that will come in due course," Mpahlwa stated.

The South African government was pursuing the options to deal with the steel pricing issue.

The study was one of five actions aimed at reducing the cost of steel inputs to the downstream fabrication sector, the others being a strengthening of the Competition Act; the creation of a State-owned enterprise pricing and procurement framework; reviewing the role of merchants in the value chain; and putting in place measures to reduce the exportation of scrap.

But while previous plans were centred primarily on the desire to increase the local beneficiation of ferrous minerals, such as iron-ore and manganese, the new study was interrogating the viability of an integrated mill.

It was understood that the prefeasibility study was being undertaken by State minerals and metallurgical research house Mintek, in collaboration with the IDC.


Edited by: Mariaan Webb
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