Podcasts about arcelormittal south africa

Stephen Grootes speaks to Donald MacKay, Director at XA Global Trade Advisors, about the government's last-ditch efforts to strike a deal and rescue ArcelorMittal South Africa from financial collapse and potential mass job losses. The Money Show is a podcast hosted by well-known journalist and radio presenter, Stephen Grootes. He explores the latest economic trends, business developments, investment opportunities, and personal finance strategies. Each episode features engaging conversations with top newsmakers, industry experts, financial advisors, entrepreneurs, and politicians, offering you thought-provoking insights to navigate the ever-changing financial landscape.Thank you for listening to The Money Show podcast.Listen live - The Money Show with Stephen Grootes is broadcast weekdays between 18:00 and 20:00 (SA Time) on 702 and CapeTalk. There’s more from the show at www.themoneyshow.co.za Subscribe to the Money Show daily and weekly newslettersThe Money Show is brought to you by Absa. Follow us on:702 on Facebook: www.facebook.com/TalkRadio702 702 on TikTok: www.tiktok.com/@talkradio702702 on Instagram: www.instagram.com/talkradio702702 on X: www.x.com/Radio702702 on YouTube: www.youtube.com/@radio702CapeTalk on Facebook: www.facebook.com/CapeTalk CapeTalk on TikTok: www.tiktok.com/@capetalk CapeTalk on Instagram: www.instagram.com/capetalkzaCapeTalk on YouTube: www.youtube.com/@CapeTalk567CapeTalk on X: www.x.com/CapeTalkSee omnystudio.com/listener for privacy information.

Stephen Grootes discusses the Reserve Bank's repo rate decision with expert analysis, and is joined by Terence Creamer to explore the government's potential bailout of ArcelorMittal South Africa's struggling steel business. The Money Show is a podcast hosted by well-known journalist and radio presenter, Stephen Grootes. He explores the latest economic trends, business developments, investment opportunities, and personal finance strategies. Each episode features engaging conversations with top newsmakers, industry experts, financial advisors, entrepreneurs, and politicians, offering you thought-provoking insights to navigate the ever-changing financial landscape.Thank you for listening to The Money Show podcast.Listen live - The Money Show with Stephen Grootes is broadcast weekdays between 18:00 and 20:00 (SA Time) on 702 and CapeTalk.There’s more from the show at www.themoneyshow.co.zaSubscribe to the Money Show daily and weekly newslettersThe Money Show is brought to you by Absa.Follow us on:702 on Facebook: www.facebook.com/TalkRadio702702 on TikTok: www.tiktok.com/@talkradio702702 on Instagram: www.instagram.com/talkradio702702 on X: www.x.com/Radio702702 on YouTube: www.youtube.com/@radio702CapeTalk on Facebook: www.facebook.com/CapeTalkCapeTalk on TikTok: www.tiktok.com/@capetalkCapeTalk on Instagram: www.instagram.com/capetalkzaCapeTalk on YouTube: www.youtube.com/@CapeTalk567CapeTalk on X: www.x.com/CapeTalk See omnystudio.com/listener for privacy information.

Stephen Grootes speaks to Terence Creamer, Editor of Engineering News, about the current state of play regarding the government's financial intervention in ArcelorMittal South Africa's (AMSA) troubled long steel operations. The Money Show is a podcast hosted by well-known journalist and radio presenter, Stephen Grootes. He explores the latest economic trends, business developments, investment opportunities, and personal finance strategies. Each episode features engaging conversations with top newsmakers, industry experts, financial advisors, entrepreneurs, and politicians, offering you thought-provoking insights to navigate the ever-changing financial landscape.Thank you for listening to The Money Show podcast.Listen live - The Money Show with Stephen Grootes is broadcast weekdays between 18:00 and 20:00 (SA Time) on 702 and CapeTalk. There’s more from the show at www.themoneyshow.co.za Subscribe to the Money Show daily and weekly newslettersThe Money Show is brought to you by Absa. Follow us on:702 on Facebook: www.facebook.com/TalkRadio702 702 on TikTok: www.tiktok.com/@talkradio702702 on Instagram: www.instagram.com/talkradio702702 on X: www.x.com/Radio702702 on YouTube: www.youtube.com/@radio702CapeTalk on Facebook: www.facebook.com/CapeTalk CapeTalk on TikTok: www.tiktok.com/@capetalk CapeTalk on Instagram: www.instagram.com/capetalkzaCapeTalk on YouTube: www.youtube.com/@CapeTalk567CapeTalk on X: www.x.com/CapeTalkSee omnystudio.com/listener for privacy information.

Members of the National Union of Metal Workers of South Africa are set to stage a picket at the offices of the Industrial Development Corporation (IDC). The demonstrations in Sandton are over looming retrenchments at ArcelorMittal South Africa. The company has indicated its intentions to shut its Long Steel business, a move that will affect 3500 jobs. Jon Gericke spoke to NUMSA's National Spokesperson, Phakamile Hlubi-Majola

The National Union of Metalworkers of South Africa (NUMSA) will stage a picket tomorrow at the Industrial Development Corporation's offices in Sandton, Johannesburg, in protest against looming retrenchments at ArcelorMittal South Africa. This follows the announcement by the company to shutdown its steel-making operations in Newcastle and Vereeniging which will result in 3,500 direct and indirect job losses. To discuss NUMSA's demands, Elvis Presslin spoke to the Union's National Spokesperson, Phakamile Hlubi-Majola

The ANC, Cosatu, SACP, and SANCO will today march against the potential closure of ArcelorMittal South Africa, which threatens to leave thousands of workers jobless. Despite the company's decision to delay the closure of its long steel business by a month, the unions are demanding urgent government intervention to save the operations in Newcastle and Vereeniging. For more on today's planned march Elvis Presslin spoke to Cosatu Gauteng Secretary, Louisa Modikwe

Government is holding urgent talks with ArcelorMittal amid the company's plans to close down its operations. Labour Minister Nomakhosazana Meth is meeting the management of ArcelorMittal South Africa today. ArcelorMittal South Africa announced that it would close facilities that produce long-steel products in the towns of Newcastle and Vereeniging and a rail-fabrication facility in eMalahleni because it couldn't make them profitable. This would lead to as many as 3 500 jobs loses. To discuss the challenges facing the steel sector, Sakina Kamwendo spoke to the President of Steel and Engineering Industries Federation of South Africa SEIFSA, Elias Monage.

Stephen Grootes speaks to Donald MacKay, CEO at XA Global Trade Advisors, about the far-reaching implications of ArcelorMittal South Africa's decision to shut down its long steel production, which may put over 100,000 jobs at risk.See omnystudio.com/listener for privacy information.

The news of the winding up of ArcelorMittal South Africa long steel business operations in Newcastle Works and Vereeniging , does not bode well for the South African industrialization agenda. This is according to Don Consultancy Group , Chief Economist , Chifi Mhango. The closure set to take effect at the end of January, will result in approximately 3,500 direct job losses, with industry experts warning of far more extensive damage to the broader economy. To unpack Bongiwe Zwane spoke to Don Consultancy Group (DCG) Chief Economist, Chifi Mhango..

The National Union of Metalworkers of South Africa (NUMSA) has expressed concern over ArcelorMittal South Africa's announcement of possible job cuts at its mills in Newcastle and Vereeniging, which could affect around 3,500 jobs. The steelmaker blames prolonged weak economic conditions, structural issues and uncompetitive conditions for its decision to close some operations. For more on this development, Elvis Presslin spoke to NUMSA's National Spokesperson, Phakamile Hlubi-Majola

The National Union of Metalworkers of South Africa (NUMSA) has embarked on a strike at ArcelorMittal South Africa in response to the company's decision to retrench 107 workers just before Christmas. NUMSA National Spokesperson, Phakamile Hlubi-Majola, spoke to Elvis Presslin to discuss the strike and the union's demands...

Odwa Magwentshu of Trive South Africa discusses the ArcelorMittal South Africa trading update and the potential opportunity with MultiChoice trading at R107 against a R125 offer. Rob van Eyden, CEO of Scope Markets SA, observes a shift in trader preferences from FX to lower-risk indices. Keri-lee Edmond from Old Mutual Corporate Consultants explains how the new two-pot retirement system could potentially double or triple younger investors' retirement funds.

This audio is brought to you by Endress and Hauser, a leading supplier of products, solutions and services for industrial process measurement and automation. Over a five-year period, the average 1.3% a year decline in the metals and engineering sector will lead to an average 2.9% decline in employment, or 293 754 direct and indirect job losses, industry organisation Steel and Engineering Industries Federation of Southern Africa (Seifsa) COO Tafadzwa Chibanguza warns. This is based on the statistics that, between 2008 and 2023, production contracted at a rate of 1.3% a year, while employment decreased by 2.9% a year, which led the sector to lose 214 636 jobs, or 37.2%, since then. There are 362 871 people currently employed in the sector, down from the 577 507 people employed in 2008. "Employment in the sector has decreased at double the rate by which production has decreased over the same period. Given that the steel sector has an induced economic multiplier of 2.7 times, an employment multiplier of six times and a dependency ratio of between seven and ten people relying on each formal job, the sector's employment trend spells wide-scale social and economic disaster," he says. The sector is a crucial supplier of inputs into other sectors, such as agriculture, mining, the automotive sector, construction, the electricity supply industry across all its facets, logistics and water sectors. Further, the sector is export intensive, with 40% of total production being exported, raising the country's foreign exchange receipts by $20-billion a year. With the recent announcement by ArcelorMittal South Africa of the closure of its operations in Newcastle and Vereeniging, as well as ArcelorMittal Rail and Structural, the prospect of such developments materialising is a major cause of concern that will only exacerbate the downward spiral of employment in the sector, he adds. "The long products operations under consideration for closure include the country's only local mill capable of producing long steel from iron-ore, which are critical in industries such as construction, automotive, mining, electro-technical, electricity transmission, rail, wire and fasteners industry. "The reliance of these downstream industries is not a preference question but rather higher quality and safety specifications. Faced with the prospect of a lack of domestic supply, these downstream industries will have no alternative but to look to import their feedstock, which translates to the loss of much needed domestic jobs, further deepening the unemployment crisis," says Chibanguza. Of the 362 871 people employed in the sector, the downstream industries account for 90% of the employment with the balance being employed in the upstream. This number has evolved from 80% downstream and 20% upstream over the past 15 years. Additionally, although the job losses have been felt across the entire value chain, they have mostly been concentrated in the downstream industries, which have accounted for 60.2% of the losses recorded over this period. "The impact of the plant closures will mostly be felt in the downstream where the bulk of employment resides." A greater concern is that several downstream companies have started estimating the business cases of importing their final product, as opposed to semi-finished products such as billets, blooms, among others, for further processing locally. This will have even wider employment ramifications by eliminating other intermediate processes like forging, galvanising and packaging, thereby converting many existing factories into distribution warehouses, he adds. "The reasons for the AMSA plant closure are structural, namely low economic growth, anaemic gross fixed capital formation, and electricity and logistics challenges. These are factors faced by companies in the entire value chain and without urgent intervention and reform are unlikely to be resolved in the medium term. "It is conceivable, therefore, that in the absence of refor...

This audio is brought to you by Endress and Hauser, a leading supplier of products, solutions and services for industrial process measurement and automation. Over a five-year period, the average 1.3% a year decline in the metals and engineering sector will lead to an average 2.9% decline in employment, or 293 754 direct and indirect job losses, industry organisation Steel and Engineering Industries Federation of Southern Africa (Seifsa) COO Tafadzwa Chibanguza warns. This is based on the statistics that, between 2008 and 2023, production contracted at a rate of 1.3% a year, while employment decreased by 2.9% a year, which led the sector to lose 214 636 jobs, or 37.2%, since then. There are 362 871 people currently employed in the sector, down from the 577 507 people employed in 2008. "Employment in the sector has decreased at double the rate by which production has decreased over the same period. Given that the steel sector has an induced economic multiplier of 2.7 times, an employment multiplier of six times and a dependency ratio of between seven and ten people relying on each formal job, the sector's employment trend spells wide-scale social and economic disaster," he says. The sector is a crucial supplier of inputs into other sectors, such as agriculture, mining, the automotive sector, construction, the electricity supply industry across all its facets, logistics and water sectors. Further, the sector is export intensive, with 40% of total production being exported, raising the country's foreign exchange receipts by $20-billion a year. With the recent announcement by ArcelorMittal South Africa of the closure of its operations in Newcastle and Vereeniging, as well as ArcelorMittal Rail and Structural, the prospect of such developments materialising is a major cause of concern that will only exacerbate the downward spiral of employment in the sector, he adds. "The long products operations under consideration for closure include the country's only local mill capable of producing long steel from iron-ore, which are critical in industries such as construction, automotive, mining, electro-technical, electricity transmission, rail, wire and fasteners industry. "The reliance of these downstream industries is not a preference question but rather higher quality and safety specifications. Faced with the prospect of a lack of domestic supply, these downstream industries will have no alternative but to look to import their feedstock, which translates to the loss of much needed domestic jobs, further deepening the unemployment crisis," says Chibanguza. Of the 362 871 people employed in the sector, the downstream industries account for 90% of the employment with the balance being employed in the upstream. This number has evolved from 80% downstream and 20% upstream over the past 15 years. Additionally, although the job losses have been felt across the entire value chain, they have mostly been concentrated in the downstream industries, which have accounted for 60.2% of the losses recorded over this period. "The impact of the plant closures will mostly be felt in the downstream where the bulk of employment resides." A greater concern is that several downstream companies have started estimating the business cases of importing their final product, as opposed to semi-finished products such as billets, blooms, among others, for further processing locally. This will have even wider employment ramifications by eliminating other intermediate processes like forging, galvanising and packaging, thereby converting many existing factories into distribution warehouses, he adds. "The reasons for the AMSA plant closure are structural, namely low economic growth, anaemic gross fixed capital formation, and electricity and logistics challenges. These are factors faced by companies in the entire value chain and without urgent intervention and reform are unlikely to be resolved in the medium term. "It is conceivable, therefore, that in the absence of refor...

The recent announcement by ArcelorMittal South Africa on the potential closure of its operations in Newcastle and Vereeniging has set off warning bells. Lester Kiewit speaks Tafadzwa Chibanguza, SEIFSA COO about the collapse of the Steel Master Plan for South Africa. See omnystudio.com/listener for privacy information.

The recent announcement by ArcelorMittal South Africa on the potential closure of its operations in Newcastle and Vereeniging has set off warning bells. Lester Kiewit speaks Tafadzwa Chibanguza, SEIFSA COO about the collapse of the Steel Master Plan for South Africa. See omnystudio.com/listener for privacy information.

Serious questions about the effectiveness and desirability of South Africa's prevailing scrap export ban have been raised in a new report, which calls for its immediate lifting unless evidence can be produced showing that the ban is having the desired effect of preventing infrastructure-related theft. Published by XA Global Trade Advisors, the report follows hot on the heels of a decision by ArcelorMittal South Africa to wind down its long-products business, partly because its integrated mills are unable to compete with those electric-arc furnaces that have secured a significant raw material advantage as a result of the trade restrictions placed on scrap. XA Global Trade Advisors CEO Donald MacKay argues that the combination of the price preference system, scrap export duties and the prevailing export ban have distorted the domestic steel value chain and have created financial risks that could have major implications for the State-owned Industrial Development Corporation (IDC) if unwound. The report calculates that there are yearly value transfers of R4.5-billion from metals recyclers to the scrap-based mini-mills on the three-million tons of scrap being sold yearly. It also estimates that the IDC has built up a R14-billion exposure to scrap-metal consuming sectors, which has created an incentive to sustain these transfers to companies that have become increasingly reliant on subsidised raw materials as electricity prices rise and infrastructure fails. "The electricity price cannot be lowered and so all the pressure is applied to the scrap recycling sector," the report argues. In response, the IDC told Engineering News that its exposure to steel-related companies stood at about R10-billion and was not confined to scrap-metal consuming firms. "The rationale for the IDC support provided to mini-mills was to increase competition in the primary steel industry, improve economic inclusion, access to markets for small and medium enterprises and black industrialists, and to enhance competition in related products. "The investment case also concerns market segmentation and the ability to comply with the market's requirements," the IDC stated. It added that the mini-mills supplied a complementary range of "fit-for-purpose" commodity products which were mainly driven by competitive factors such as an ability to respond to the market in a short period of time at the right price. "While several of the IDC's investee companies produce the standard commodity-type bar mill range, upgrades have also taken place over the years towards higher quality products and diversification," it added in response to questions. The XA report also highlights a lack of data transparency since the initial ban on the export of ferrous and nonferrous scrap metal was imposed by the Department of Trade, Industry and Competition (dtic) on November 30, 2022, or following its six-month extension on July 31 this year. MacKay says that, despite Promotion of Access to Information Act requests, no information has been released on the theft of infrastructure since the ban, with even Transnet's cable theft data, which had been published regularly on the State-owned utility's website, having been removed from the public domain. Transparency, MacKay argues, is essential for assessing whether the ban's negative economic impacts are outweighed by the benefits. "The secrecy around scrap metal policy has created fertile ground for lobbying and corrupt decisions," he adds. The dtic told Engineering News it would study the report but did not want to comment so close to the closing date for comments on whether or not to extend the ban. "All comments received by the closing date will be carefully considered by Minister Ebrahim Patel before a decision is taken. "The Minister will consider all inputs and will carefully weigh the impact of the scrap and waste-metal ban on the steel value-chain against the substantial damage done to infrastructure and the associated disruptions to bus...

Serious questions about the effectiveness and desirability of South Africa's prevailing scrap export ban have been raised in a new report, which calls for its immediate lifting unless evidence can be produced showing that the ban is having the desired effect of preventing infrastructure-related theft. Published by XA Global Trade Advisors, the report follows hot on the heels of a decision by ArcelorMittal South Africa to wind down its long-products business, partly because its integrated mills are unable to compete with those electric-arc furnaces that have secured a significant raw material advantage as a result of the trade restrictions placed on scrap. XA Global Trade Advisors CEO Donald MacKay argues that the combination of the price preference system, scrap export duties and the prevailing export ban have distorted the domestic steel value chain and have created financial risks that could have major implications for the State-owned Industrial Development Corporation (IDC) if unwound. The report calculates that there are yearly value transfers of R4.5-billion from metals recyclers to the scrap-based mini-mills on the three-million tons of scrap being sold yearly. It also estimates that the IDC has built up a R14-billion exposure to scrap-metal consuming sectors, which has created an incentive to sustain these transfers to companies that have become increasingly reliant on subsidised raw materials as electricity prices rise and infrastructure fails. "The electricity price cannot be lowered and so all the pressure is applied to the scrap recycling sector," the report argues. In response, the IDC told Engineering News that its exposure to steel-related companies stood at about R10-billion and was not confined to scrap-metal consuming firms. "The rationale for the IDC support provided to mini-mills was to increase competition in the primary steel industry, improve economic inclusion, access to markets for small and medium enterprises and black industrialists, and to enhance competition in related products. "The investment case also concerns market segmentation and the ability to comply with the market's requirements," the IDC stated. It added that the mini-mills supplied a complementary range of "fit-for-purpose" commodity products which were mainly driven by competitive factors such as an ability to respond to the market in a short period of time at the right price. "While several of the IDC's investee companies produce the standard commodity-type bar mill range, upgrades have also taken place over the years towards higher quality products and diversification," it added in response to questions. The XA report also highlights a lack of data transparency since the initial ban on the export of ferrous and nonferrous scrap metal was imposed by the Department of Trade, Industry and Competition (dtic) on November 30, 2022, or following its six-month extension on July 31 this year. MacKay says that, despite Promotion of Access to Information Act requests, no information has been released on the theft of infrastructure since the ban, with even Transnet's cable theft data, which had been published regularly on the State-owned utility's website, having been removed from the public domain. Transparency, MacKay argues, is essential for assessing whether the ban's negative economic impacts are outweighed by the benefits. "The secrecy around scrap metal policy has created fertile ground for lobbying and corrupt decisions," he adds. The dtic told Engineering News it would study the report but did not want to comment so close to the closing date for comments on whether or not to extend the ban. "All comments received by the closing date will be carefully considered by Minister Ebrahim Patel before a decision is taken. "The Minister will consider all inputs and will carefully weigh the impact of the scrap and waste-metal ban on the steel value-chain against the substantial damage done to infrastructure and the associated disruptions to bus...

Creamer Media editor Terence Creamer discusses ArcelorMittal South Africa's announcement that it may cut about 3 500 jobs as it plans to wind down its long-products business; the reasons for it taking this step; the impact of the closure on the town of Newcastle, as well as South Africa's industrial capacity and beneficiation ambitions; and whether there is anything government can do to prevent the closure of the business and the job losses.

Creamer Media editor Terence Creamer discusses ArcelorMittal South Africa's announcement that it may cut about 3 500 jobs as it plans to wind down its long-products business; the reasons for it taking this step; the impact of the closure on the town of Newcastle, as well as South Africa's industrial capacity and beneficiation ambitions; and whether there is anything government can do to prevent the closure of the business and the job losses.

The CEO of ArcelorMittal South Africa, Kobus Verster, says the company is open to engagement and consultation processes with labour, the government, and various stakeholders. This is as the company has announced plans to cut up to 3-thousand 500 jobs as it's forced to shut down its long steel products business (e.g., railway tracks). The company has blamed negative steel demand growth and the state of instability of Transnet and Eskom issues. Sakina Kamwendo spoke to Donald MacKay, CEO of XA Global Trade Advisors

Thousands of jobs are at risk in the mining, metal and engineering sector as companies struggle to stay afloat. The National Union of Mineworkers, NUM estimates 10,000 job losses to the industry by January next year. While steel producer ArcelorMittal South Africa is set to shed 3 500 jobs at its Newcastle and Vereeniging operations. To examine the knock-on economic effect of retrenchments, Elvis Presslin spoke to Professor Jannie Rossouw, a visiting Professor at the Wits Business School

Steel producer ArcelorMittal South Africa (AMSA) has indicated that it may close its long-products business, which could result in the loss of 3 500 direct and contractor jobs at its Newcastle and Vereeniging operations. In a statement, the JSE-listed company said the potential wind down had been precipitated by structural issues outside of its control, including: A 20% fall in demand over the last seven years to four-million tonnes, on the back of persistently low economic growth, limited infrastructure spend and project delays; Rising transport and logistics costs, compounded by rail-service disruptions, as well as escalating energy prices; and The prevailing scrap advantage over iron-ore, precipitated by the preferential pricing system for scrap, a 20% export duty, and the recently imposed ban on scrap exports, which had given electric arc furnaces an "artificial" competitive advantage over integrated mills beneficiating iron-ore. CEO Kobus Verster said the board and management decision to consider a wind down of the long-products business was reached after "all possible options" were exhausted, had not been "taken lightly" and was being pursued in an effort to place the rest of the business on a "sustainable financial footing". The company also acknowledged the potential negative impact on the regional and local economies in which the mills were located, in particular the Newcastle Works, which was a major source of economic activity and jobs in the KwaZulu-Natal town. The company said the wind-down would exclude the coke batteries at Newcastle, which would remain operative, producing metallurgical coke for use at the Vanderbijlpark Works, and for sale of commercial market coke to the ferro-alloy industry. A consultation process in accordance with Section 189(3) of the Labour Relations Act will be initiated with unions and "every effort will be made to manage down the number of jobs affected". "The conclusion and number of affected posts will be finalised within a detailed wind down implementation plan that is being developed," the company said. UNCERTAIN CHRISTMAS Trade union Solidarity responded with shock to the announcement that three long-steel plants could be closed, noting that Arcelor Rail and Structures was also potentially affected by the wind down. It said that 3 500 employees and their families were now facing an uncertain Christmas season. The union also questioned the timing of the "drastic" move, noting that loadshedding and Transnet's high costs and unreliability were "nothing new". Solidarity argued, therefore, that a consultation process with parties affected by the decision, including trade unions, should have preceded the announcement, noting that it was still awaiting the formal restructuring notices. "After receipt of the section 189 (A) notice, Solidarity will start to meet with members and will support them during all the processes that may follow." ArcelorMittal South Africa said it also intended engaging with its customers and suppliers "to minimise the disruptions to their business, as far as reasonably possible". "The company continues to engage directly with government," the company added. AMSA slumped to a R448-million loss in the interim period to June 30, a dramatic deterioration from the comparable period of 2022 when it reported a R3-billion profit. The poor performance was attributed to intense loadshedding during the period, which not only disrupted the group's operations, because of 41 Eskom instructions during the period for a curtailment of its electricity demand, but also downstream demand, as fabricators pulled back on production shifts. The group has also been vocal about the negative impact of the collapse of the Transnet Freight Rail service, which has been particularly acutely felt at the Newcastle Works, which is located far away from its sources of raw materials. Solidarity said the ArcelorMittal South Africa announcement was a signal that government's mismanagement of Stat...

Steel producer ArcelorMittal South Africa (AMSA) has indicated that it may close its long-products business, which could result in the loss of 3 500 direct and contractor jobs at its Newcastle and Vereeniging operations. In a statement, the JSE-listed company said the potential wind down had been precipitated by structural issues outside of its control, including: A 20% fall in demand over the last seven years to four-million tonnes, on the back of persistently low economic growth, limited infrastructure spend and project delays; Rising transport and logistics costs, compounded by rail-service disruptions, as well as escalating energy prices; and The prevailing scrap advantage over iron-ore, precipitated by the preferential pricing system for scrap, a 20% export duty, and the recently imposed ban on scrap exports, which had given electric arc furnaces an "artificial" competitive advantage over integrated mills beneficiating iron-ore. CEO Kobus Verster said the board and management decision to consider a wind down of the long-products business was reached after "all possible options" were exhausted, had not been "taken lightly" and was being pursued in an effort to place the rest of the business on a "sustainable financial footing". The company also acknowledged the potential negative impact on the regional and local economies in which the mills were located, in particular the Newcastle Works, which was a major source of economic activity and jobs in the KwaZulu-Natal town. The company said the wind-down would exclude the coke batteries at Newcastle, which would remain operative, producing metallurgical coke for use at the Vanderbijlpark Works, and for sale of commercial market coke to the ferro-alloy industry. A consultation process in accordance with Section 189(3) of the Labour Relations Act will be initiated with unions and "every effort will be made to manage down the number of jobs affected". "The conclusion and number of affected posts will be finalised within a detailed wind down implementation plan that is being developed," the company said. UNCERTAIN CHRISTMAS Trade union Solidarity responded with shock to the announcement that three long-steel plants could be closed, noting that Arcelor Rail and Structures was also potentially affected by the wind down. It said that 3 500 employees and their families were now facing an uncertain Christmas season. The union also questioned the timing of the "drastic" move, noting that loadshedding and Transnet's high costs and unreliability were "nothing new". Solidarity argued, therefore, that a consultation process with parties affected by the decision, including trade unions, should have preceded the announcement, noting that it was still awaiting the formal restructuring notices. "After receipt of the section 189 (A) notice, Solidarity will start to meet with members and will support them during all the processes that may follow." ArcelorMittal South Africa said it also intended engaging with its customers and suppliers "to minimise the disruptions to their business, as far as reasonably possible". "The company continues to engage directly with government," the company added. AMSA slumped to a R448-million loss in the interim period to June 30, a dramatic deterioration from the comparable period of 2022 when it reported a R3-billion profit. The poor performance was attributed to intense loadshedding during the period, which not only disrupted the group's operations, because of 41 Eskom instructions during the period for a curtailment of its electricity demand, but also downstream demand, as fabricators pulled back on production shifts. The group has also been vocal about the negative impact of the collapse of the Transnet Freight Rail service, which has been particularly acutely felt at the Newcastle Works, which is located far away from its sources of raw materials. Solidarity said the ArcelorMittal South Africa announcement was a signal that government's mismanagement of Stat...

ArcelorMittal South Africa (AMSA) CEO Kobus Verster believes there is no immediate prospect of addressing the structural issues undermining the financial viability of the group's long-products business and tells Engineering News that the operations will begin ramping down during January, when they are scheduled to stop receiving steelmaking materials, such as iron-ore. Verster provided this bleak assessment in an interview following the JSE-listed company's announcement that it would be initiating consultations with unions and customers on the closure of its operations in Newcastle and Vereeniging, as well as ArcelorMittal Rail and Structural, which relies on intermediate products currently produced at Newcastle. Although the closure of certain parts of the long-products business has been mooted previously, including in 2019 and 2021, the announcement of the proposed wind down still came as a shock, even though the group swung from a R3-billion profit in the first half of 2022 to a R448-million loss during the same period this year. The loss was attributed largely to electricity load curtailment, implemented at energy-intensive firms at high stages of loadshedding, which had again been escalated to between Stage 4 and 6 when ArcelorMittal South Africa made its wind-down announcement. It also came amid increased strain between business and government, more generally. Automotive group Volkswagen issued a warning about the company's South African operations, citing loadshedding and logistics problems as key concerns, while platinum producers have indicated that job cuts are inevitable. Meanwhile, Minister in the Presidency Khumbudzo Ntshavheni, who was widely condemned for suggesting that the private sector was engineering the collapse of the government when commenting on a rand manipulation-related settlement, appeared to double down in an opinion piece penned for the Business Day. Verster spoke to Engineering News after having held in-person meetings with employees at the Newcastle mill, in KwaZulu-Natal, who make up about 2 600 of the 3 500 direct employees and contractors likely to be affected by the closures. He reported that contact had also been made with the leadership of the company's two recognised unions, being the National Union of Metalworkers and Solidarity, and indicated that formal negotiations were likely to start either later this week or early next week, with Section 189 retrenchment notices expected within days. In a statement, Solidarity questioned the timing of what it described as a "drastic" move by the company and lamented the fact that 3 500 employees and their families faced an uncertain Christmas season. It also argued that some of the reasons given for the proposed wind down, including loadshedding by Eskom and Transnet's high costs and unreliability were "nothing new" and suggested that consultations should have been initiated ahead of any announcement. However, Verster argued that, while high electricity and logistics costs and the unreliability of both utilities were aggravating factors, the competitiveness of the long-products business had been eroded by weak demand and a structural over-supply. It had been further amplified by what he described as an artificial competitive advantage provided to electric-arc furnaces (EAFs) because of government's prevailing scrap policy. The company highlighted the preferential pricing system for scrap in its official statement on the wind down, arguing the policy, together with a 20% export duty and the recent scrap export ban, had made it impossible for an integrated iron-ore-based producer such as Newcastle to be price competitive. While AMSA manufactured some value-added long products, the bulk of its 900 000 t/y longs production was low-margin material that was currently uncompetitive in a market where demand stood at about 1.8-million tons against Verster's estimate of there being yearly production capacity of four-million tons. The flat-products busines...

ArcelorMittal South Africa (AMSA) CEO Kobus Verster believes there is no immediate prospect of addressing the structural issues undermining the financial viability of the group's long-products business and tells Engineering News that the operations will begin ramping down during January, when they are scheduled to stop receiving steelmaking materials, such as iron-ore. Verster provided this bleak assessment in an interview following the JSE-listed company's announcement that it would be initiating consultations with unions and customers on the closure of its operations in Newcastle and Vereeniging, as well as ArcelorMittal Rail and Structural, which relies on intermediate products currently produced at Newcastle. Although the closure of certain parts of the long-products business has been mooted previously, including in 2019 and 2021, the announcement of the proposed wind down still came as a shock, even though the group swung from a R3-billion profit in the first half of 2022 to a R448-million loss during the same period this year. The loss was attributed largely to electricity load curtailment, implemented at energy-intensive firms at high stages of loadshedding, which had again been escalated to between Stage 4 and 6 when ArcelorMittal South Africa made its wind-down announcement. It also came amid increased strain between business and government, more generally. Automotive group Volkswagen issued a warning about the company's South African operations, citing loadshedding and logistics problems as key concerns, while platinum producers have indicated that job cuts are inevitable. Meanwhile, Minister in the Presidency Khumbudzo Ntshavheni, who was widely condemned for suggesting that the private sector was engineering the collapse of the government when commenting on a rand manipulation-related settlement, appeared to double down in an opinion piece penned for the Business Day. Verster spoke to Engineering News after having held in-person meetings with employees at the Newcastle mill, in KwaZulu-Natal, who make up about 2 600 of the 3 500 direct employees and contractors likely to be affected by the closures. He reported that contact had also been made with the leadership of the company's two recognised unions, being the National Union of Metalworkers and Solidarity, and indicated that formal negotiations were likely to start either later this week or early next week, with Section 189 retrenchment notices expected within days. In a statement, Solidarity questioned the timing of what it described as a "drastic" move by the company and lamented the fact that 3 500 employees and their families faced an uncertain Christmas season. It also argued that some of the reasons given for the proposed wind down, including loadshedding by Eskom and Transnet's high costs and unreliability were "nothing new" and suggested that consultations should have been initiated ahead of any announcement. However, Verster argued that, while high electricity and logistics costs and the unreliability of both utilities were aggravating factors, the competitiveness of the long-products business had been eroded by weak demand and a structural over-supply. It had been further amplified by what he described as an artificial competitive advantage provided to electric-arc furnaces (EAFs) because of government's prevailing scrap policy. The company highlighted the preferential pricing system for scrap in its official statement on the wind down, arguing the policy, together with a 20% export duty and the recent scrap export ban, had made it impossible for an integrated iron-ore-based producer such as Newcastle to be price competitive. While AMSA manufactured some value-added long products, the bulk of its 900 000 t/y longs production was low-margin material that was currently uncompetitive in a market where demand stood at about 1.8-million tons against Verster's estimate of there being yearly production capacity of four-million tons. The flat-products busines...

This audio is brought to you by Wearcheck, your condition monitoring specialist,. The world over, green hydrogen is being recognised as the most effective route towards combating the climate crisis in the most holistic way possible, with Minerals Council South Africa highlighting the collaboration of South Africa's leading platinum mining company with a local grey hydrogen producer and a car company with 30 global production site and a 140-country sales network. Collaborating in the trialling of hydrogen fuel cell vehicles are Anglo American Platinum, BMW Group South Africa and Sasol South Africa in the trialing of fuel cell electric vehicles (FCEVs) in which the green hydrogen is converted into clean electricity by platinum catalysts. "As countries around the world reduce their environmental footprint by reducing greenhouse gas emissions and address climate change concerns, green hydrogen is a vital component in the shift towards green energy sources," the Minerals Council stated in its release to Mining Weekly. For South Africa, which is the largest supplier of platinum group metals (PGMs), the use of green hydrogen in the auto sector is an important development that could generate demand of up to five-million ounces of platinum group metals (PGMs) a year if hydrogen fuel cells are used in 10% of the global car market. This will underpin job security for the 175 000 people employed in the PGM mining sector. Coinciding with the Minerals Council media release were several other local releases and many global newsbreaks emphasising green hydrogen's far-reaching momentum. As reported by Engineering News at the weekend, South Africa's Eastern Cape, Northern Cape and Western Cape provinces have agreed to team up in a bid to position South Africa as a global hub for the production of green hydrogen and derivative products, as well as to produce the components required in the green hydrogen value chain, ahead of the finalisation of South Africa's Green Hydrogen Commercialisation Strategy. In addition, steel producer ArcelorMittal South Africa is moving ahead with a study into the production of green hydrogen directly reduced iron (gHDRI) at its mothballed Saldanha Steel Works, in the Western Cape. The JSE-listed group has signed a memorandum of understanding with an as yet unnamed "developer of transformational energy solutions" to advance the production of gHDRI at the plant. On Monday, Charbone Hydrogen of Canada announced the launching of the construction of the first phase of Toronto-listed company's green hydrogen production facility in Quebec This followed the energy company with Australia's iron-ore mining group Fortescue has announced plans to build a 550 MW electrolyser at its Gibson Island Project in Brisbane, a platinum-based proton exchange membrane electrolyser as well as European company Lhyfe, a world pioneer in the production of green and renewable hydrogen for transport and industrial applications, turning the first sod for the construction of a hydrogen production plant in the German city of Schwäbisch Gmünd. This plant will be the first to supply hydrogen directly to an industrial park. It is also the first in a network of many plants that will be operated by Lhyfe, which is setting out to deliver green hydrogen in bulk in Germany and France by 2025. In addition, Fortescue and Plug of the US have started the initial diligence process for Fortescue to take up to a 40% equity stake in Plug's Texas green hydrogen plant and for Plug to take up to a 25% equity stake in Fortescue's proposed Phoenix green hydrogen plant. The World Platinum Investment Council, with its eye on the demand for platinum that the green hydrogen rollout will generate, expects one-million FCEVs to be on China's roads by 2035 and that one in eight newly registered commercial vehicles worldwide will be powered by hydrogen fuel cells by 2030. The broad-based commercial adoption of FCEVs could add more than three-million ounces to yearly platinum...

Construction tower cranes have been something of a rare sight on the Germiston skyline over the past few decades as the once-thriving industrial hub has faced severe deindustrialisation headwinds. Several such cranes have made a reappearance at Scaw Metals' Union Junction complex in Ekurhuleni in recent months, however, in support of a R3-billion steel investment to increase Scaw's steelmaking capacity from about 500 000 t/y to 650 000 t/y. This seemingly modest capacity increase somewhat belies the significance of the project, which is South Africa's first flat-steel investment since the Saldanha Steel project was initiated by then Iscor (now ArcelorMittal South Africa, or AMSA) and the Industrial Development Corporation (IDC) in the 1990s. Barnes Group CEO Doron Barnes – whose company acquired Scaw Metals, together with its Haggie and McKinnon Chain units, in May 2018 – tells Engineering News that the investment has been informed primarily by the current domestic manufacturing imbalance between flat and long steel. There is sufficient long-product capacity, which is reflected in the price, while AMSA is currently the only remaining producer of flat-steel products after the closure of Highveld Steel. Scaw has hitherto produced only long-steel products, but the investment under way will position it to produce both long and flat products, with a 50/50 mix envisaged currently. In addition, AMSA's mothballing of the Saldanha Steel mill, in the Western Cape, has resulted in the closure of significant local capacity to produce thin-gauge hot rolled coil (HRC), on which some domestic re-rollers previously relied. Barnes says the intention is to position Scaw Union Junction to produce both long and flat steel, using an advanced solution that is being supplied by Danieli, of Italy, which also supplied substantial portions of Scaw's current steelmaking and rolling plant units, installed when the company was still owned by Anglo American. Half of the investment cost is being funded from internal Barnes Group resources, with the balance arising from a club loan that has been extended, in equal portions, by Absa, Investec and the IDC, which continues to hold a 26% equity position in Scaw Metals. Under the contract, which was signed with Danieli in August 2021, Scaw will build a new flat-steel complex on the brownfield site in Gauteng for narrow- and medium-width HRC, at gauges of between 1.2 mm and 8.0 mm. The Barnes Group will absorb a portion of the output itself for further downstream processing at its Barnes Tubing operation in Isando and Hall Longmore operation in Wadeville, both also in Gauteng, where steel piping is manufactured. The balance will be sold into the merchant steel market or to re-rollers, which currently have no domestic flat-steel alternative to AMSA. The contract with Danieli includes several components, including a medium-slab continuous caster and semi-continuous hot-strip mill, a reheating furnace, and a brownfield water-treatment plant. It also involves the revamping of Scaw's existing meltshop, which includes a new-generation electric arc furnace. The meltshop will be fed using a combination of scrap and direct reduced iron (DRI), produced using the mill's existing kilns onsite. COGENERATION POTENTIAL Scaw has three kilns to produce DRI, not all of which have been restarted, and Barnes reports that investigations are advancing, using initial Anglo concepts, into the prospect of fitting two of the kilns with cogeneration plants to produce about 60 MW. No final investment decision has been made, but Barnes believes the project is likely to be developed in the coming two years, given South Africa's electricity crisis and the fact that tariffs are rising steeply, which has improved the economics of cogenerated electricity. At 60 MW, Scaw expects to be able to meet about 60% of its needs and buffer itself from Eskom's load-curtailment requirements. In addition, the new facility is significantly more energy effici...

Construction tower cranes have been something of a rare sight on the Germiston skyline over the past few decades as the once-thriving industrial hub has faced severe deindustrialisation headwinds. Several such cranes have made a reappearance at Scaw Metals' Union Junction complex in Ekurhuleni in recent months, however, in support of a R3-billion steel investment to increase Scaw's steelmaking capacity from about 500 000 t/y to 650 000 t/y. This seemingly modest capacity increase somewhat belies the significance of the project, which is South Africa's first flat-steel investment since the Saldanha Steel project was initiated by then Iscor (now ArcelorMittal South Africa, or AMSA) and the Industrial Development Corporation (IDC) in the 1990s. Barnes Group CEO Doron Barnes – whose company acquired Scaw Metals, together with its Haggie and McKinnon Chain units, in May 2018 – tells Engineering News that the investment has been informed primarily by the current domestic manufacturing imbalance between flat and long steel. There is sufficient long-product capacity, which is reflected in the price, while AMSA is currently the only remaining producer of flat-steel products after the closure of Highveld Steel. Scaw has hitherto produced only long-steel products, but the investment under way will position it to produce both long and flat products, with a 50/50 mix envisaged currently. In addition, AMSA's mothballing of the Saldanha Steel mill, in the Western Cape, has resulted in the closure of significant local capacity to produce thin-gauge hot rolled coil (HRC), on which some domestic re-rollers previously relied. Barnes says the intention is to position Scaw Union Junction to produce both long and flat steel, using an advanced solution that is being supplied by Danieli, of Italy, which also supplied substantial portions of Scaw's current steelmaking and rolling plant units, installed when the company was still owned by Anglo American. Half of the investment cost is being funded from internal Barnes Group resources, with the balance arising from a club loan that has been extended, in equal portions, by Absa, Investec and the IDC, which continues to hold a 26% equity position in Scaw Metals. Under the contract, which was signed with Danieli in August 2021, Scaw will build a new flat-steel complex on the brownfield site in Gauteng for narrow- and medium-width HRC, at gauges of between 1.2 mm and 8.0 mm. The Barnes Group will absorb a portion of the output itself for further downstream processing at its Barnes Tubing operation in Isando and Hall Longmore operation in Wadeville, both also in Gauteng, where steel piping is manufactured. The balance will be sold into the merchant steel market or to re-rollers, which currently have no domestic flat-steel alternative to AMSA. The contract with Danieli includes several components, including a medium-slab continuous caster and semi-continuous hot-strip mill, a reheating furnace, and a brownfield water-treatment plant. It also involves the revamping of Scaw's existing meltshop, which includes a new-generation electric arc furnace. The meltshop will be fed using a combination of scrap and direct reduced iron (DRI), produced using the mill's existing kilns onsite. COGENERATION POTENTIAL Scaw has three kilns to produce DRI, not all of which have been restarted, and Barnes reports that investigations are advancing, using initial Anglo concepts, into the prospect of fitting two of the kilns with cogeneration plants to produce about 60 MW. No final investment decision has been made, but Barnes believes the project is likely to be developed in the coming two years, given South Africa's electricity crisis and the fact that tariffs are rising steeply, which has improved the economics of cogenerated electricity. At 60 MW, Scaw expects to be able to meet about 60% of its needs and buffer itself from Eskom's load-curtailment requirements. In addition, the new facility is significantly more energy effici...

Anglo American's big nuGen hydrogen-powered truck is currently functioning “akin in operation and cost to its diesel counterpart”, says Anglo American market development principal Fahmida Smith. The global mining company in May unveiled its nuGen truck, with a 2 MW hybrid battery/hydrogen fuel-cell powerplant replacing the diesel engine. The truck, a prototype of what is the world's largest hydrogen-powered mine-haul truck, was designed by Anglo American and US company First Mode. The vehicle, which is being tested at the Mogalakwena platinum mine, in Limpopo, weighs 220 t, with a load capacity of 290 t, giving it a total weight of 510 t. Smith says roughly 80% of Anglo American's carbon dioxide emissions come from diesel use, with mining haul trucks, in turn, responsible for most of these emissions. “One of these trucks use 900 000 l of diesel a year. That presented a key opportunity for us to decarbonise.” Smith says global truck manufacturers told the mining group that there “was no way” it was possible to decarbonise a truck of that size. This prompted Anglo American to tackle the development in-house. Smith says the group is continuing the monitor and test the vehicle's performance. The fuel-cell truck is, however, only one of four hydrogen projects the company is pursuing. Anglo American is also working with a number of partners, such as Bambili Energy, Sasol and TotalEnergies, to create the country's first hydrogen corridor, with a focus on logistics – trucks and buses that use hydrogen. “That is then three projects. A fourth one is to develop, with Bambili, fuel cells for stationary applications – in particular, buildings and offices.” Bambili Energy CEO Zanele Mbatha says she believes South Africa will have fuel-cell trucks on the road “by 2024, 2025”. From Grey to Green Sasol is currently one of the largest producers of grey hydrogen in the world, says Sasol hydrogen programme management head Rilet Davison. “We've got that experience. We know how to handle the product. We know how to produce the product and how to convert the product.” Davison says this gives Sasol a strategic advantage in that it can use its existing assets in Secunda and Sasolburg to produce sustainable products such as green hydrogen. Green hydrogen is generated by renewable energy, or from low-carbon power. Green hydrogen has significantly lower carbon emissions than grey hydrogen, which is produced by steam reforming of natural gas, which currently makes up the bulk of the hydrogen market. Green hydrogen is, however, still much more expensive to produce than grey hydrogen. One of the projects Sasol is targeting is to convert its Sasolburg operation to green hydrogen in a number of ways. “We recently announced our collaboration with ArcelorMittal South Africa from a [green] steel manufacturing and application point of view,” says Davison. “A key demonstration we want to do for Sasolburg and the Vaal Triangle is to look at three different things. We already have an electrolyser – we are in the process of completing that, with the first production scheduled towards the end of 2023. “Now the output of that electrolyser will be used in demonstration projects to incubate local demand and supply, and to supply the green hydrogen to offtakers.” “For Secunda, where we currently produce synthetic aviation fuels, we have the opportunity to convert from grey to green hydrogen,” notes Davison. “We have the synthetic fuels, but, in future, we'll have sustainable aviation fuels.” Davison says Sasol already has a demonstration project, through a consortium, working towards production of 50 000 t/y. “If we can ramp that up in the future, OR Tambo [International Airport] can become a sustainable aviation hub.” Smith, Mbatha and Davison spoke at the Science Diplomacy for Economic Development (Hydrogen Economy) workshop in Cape Town.

Anglo American's big nuGen hydrogen-powered truck is currently functioning “akin in operation and cost to its diesel counterpart”, says Anglo American market development principal Fahmida Smith. The global mining company in May unveiled its nuGen truck, with a 2 MW hybrid battery/hydrogen fuel-cell powerplant replacing the diesel engine. The truck, a prototype of what is the world's largest hydrogen-powered mine-haul truck, was designed by Anglo American and US company First Mode. The vehicle, which is being tested at the Mogalakwena platinum mine, in Limpopo, weighs 220 t, with a load capacity of 290 t, giving it a total weight of 510 t. Smith says roughly 80% of Anglo American's carbon dioxide emissions come from diesel use, with mining haul trucks, in turn, responsible for most of these emissions. “One of these trucks use 900 000 l of diesel a year. That presented a key opportunity for us to decarbonise.” Smith says global truck manufacturers told the mining group that there “was no way” it was possible to decarbonise a truck of that size. This prompted Anglo American to tackle the development in-house. Smith says the group is continuing the monitor and test the vehicle's performance. The fuel-cell truck is, however, only one of four hydrogen projects the company is pursuing. Anglo American is also working with a number of partners, such as Bambili Energy, Sasol and TotalEnergies, to create the country's first hydrogen corridor, with a focus on logistics – trucks and buses that use hydrogen. “That is then three projects. A fourth one is to develop, with Bambili, fuel cells for stationary applications – in particular, buildings and offices.” Bambili Energy CEO Zanele Mbatha says she believes South Africa will have fuel-cell trucks on the road “by 2024, 2025”. From Grey to Green Sasol is currently one of the largest producers of grey hydrogen in the world, says Sasol hydrogen programme management head Rilet Davison. “We've got that experience. We know how to handle the product. We know how to produce the product and how to convert the product.” Davison says this gives Sasol a strategic advantage in that it can use its existing assets in Secunda and Sasolburg to produce sustainable products such as green hydrogen. Green hydrogen is generated by renewable energy, or from low-carbon power. Green hydrogen has significantly lower carbon emissions than grey hydrogen, which is produced by steam reforming of natural gas, which currently makes up the bulk of the hydrogen market. Green hydrogen is, however, still much more expensive to produce than grey hydrogen. One of the projects Sasol is targeting is to convert its Sasolburg operation to green hydrogen in a number of ways. “We recently announced our collaboration with ArcelorMittal South Africa from a [green] steel manufacturing and application point of view,” says Davison. “A key demonstration we want to do for Sasolburg and the Vaal Triangle is to look at three different things. We already have an electrolyser – we are in the process of completing that, with the first production scheduled towards the end of 2023. “Now the output of that electrolyser will be used in demonstration projects to incubate local demand and supply, and to supply the green hydrogen to offtakers.” “For Secunda, where we currently produce synthetic aviation fuels, we have the opportunity to convert from grey to green hydrogen,” notes Davison. “We have the synthetic fuels, but, in future, we'll have sustainable aviation fuels.” Davison says Sasol already has a demonstration project, through a consortium, working towards production of 50 000 t/y. “If we can ramp that up in the future, OR Tambo [International Airport] can become a sustainable aviation hub.” Smith, Mbatha and Davison spoke at the Science Diplomacy for Economic Development (Hydrogen Economy) workshop in Cape Town.

Sasol energy business VP Priscillah Mabelane reports that the JSE-listed group has identified three priority clusters for the roll-out of its green hydrogen strategy, while also supporting government with plans to develop Boegoebaai, in the Northern Cape, into a green hydrogen and derivatives export hub. Speaking at the South Africa Green Hydrogen Summit in Cape Town, Mabelane said Secunda, the Vaal Triangle and Saldanha Bay had been selected for various initiatives, with specific green-steel-related projects being pursued in partnership with ArcelorMittal South Africa in the Vaal Triangle and Saldanha Bay. Sasol was pursuing an initial sustainable aviation fuel (SAF) opportunity, known as the HyShiFT programme, in Secunda in partnership with Linde, Enertrag and Hydregen, which will bid to secure support under Germany's H2Global platform. Mabelane says the group has a longer-term vision to transform the OR Tambo International Airport into a global sustainable aviation hub. Enertrag new energy solutions head Dr Tobias Bischof-Niemz, who also spoke at the summit, said the installed Fischer Tropsch (FT) capacity at Secunda positioned Sasol with a significant “first-mover advantage”, given that Secunda was the only FT plant globally already producing a certified aviation fuel based on grey hydrogen. The H2Global mechanism was likely to prove crucial in unlocking the advantage, however, given that green hydrogen was a commodity, which meant it faced a “first mover disadvantage”, with later movers benefitting from the technology learnings of early adopters. Should the project receive such support, the HyShiFT programme would seek to displace 1% of the grey hydrogen currently used at Secunda with green hydrogen, which would be produced using a 200 MW electrolyser and 450 MW of renewable electricity to be produced in Mpumalanga. The green hydrogen would be used in Sasol's FT reactors to produce a certified SAF. In the Vaal Triangle cluster, meanwhile, Sasol was partnering with ArcelorMittal South Africa to investigate the production of green hydrogen for use in steelmaking, and the capturing of unavoidable carbon dioxide. Sasol was also assessing the potential to supply other industries in the region, which currently use grey hydrogen in their production processes. The group is also repurposing an existing 60 MW electrolyser in Sasolburg to produce green hydrogen that will be used to pilot other green-mobility projects in partnership with the Industrial Development Corporation, including some Toyota Mirani fuel-cell vehicles and mine haulage trucks. In time, Sasol will also look to transition the 500 000 t ammonia and methanol produced at Sasolburg from grey to green hydrogen. In Saldanha, Sasol was also partnering with ArcelorMittal South Africa on a green steel project using green hydrogen, which could result in the re-opening of parts of the mothballed Saldanha Steel mill Meanwhile, President Cyril Ramaphosa offered an update on the Boegoebaai green hydrogen studies being facilitated by Sasol. The President said significant progress had been made on master plan for a green hydrogen special economic zone (SEZ) at Boegoebaai, with the aspiration to support 40 GW of electrolyser capacity by 2050. Mabelane said Sasol's green hydrogen strategy had two imperatives: “One is to anchor the local demand [and] the second part is to drive the green hydrogen hub facilitation.”

JSE-listed group Sasol expects to conclude power purchase agreements for 600 MW of renewable energy “imminently” as it moves ahead with plans to meet a 2030 target of reducing its greenhouse-gas (GHG) emissions by 30%, while sustaining energy and chemical production volumes. The renewables electricity will be wheeled to the group's South African operations through the Eskom grid by 2025 and Sasol expects to add a further 600 MW of renewables by 2030. The emission-reduction commitment, which was unveiled in 2021, has been made against a 2017 baseline of 63.9-million carbon dioxide equivalent (CO2e) tons and implies a reduction to 44.7-million CO2e tons by 2030. The group has also pledged to be a net-zero emissions company by 2050. Speaking to investors during a climate roundtable, CEO Fleetwood Grobler described the procurement of renewables as a key initial lever in its decarbonisation strategy to 2030, during which the group would also seek to displace coal with gas, reduce coal use through the closure of six coal-fired boilers in Secunda and implement energy efficiency projects. The group was also investigating several green hydrogen and green hydrogen-derivative opportunities, particularly to displace the 2.4-million tons of emissions-intensive ‘grey hydrogen' it produces currently, mainly from coal, and which the company uses to produce fuels and chemicals through its Fischer Tropsch (FT) technology. Grobler stressed, however, that meeting the 2030 GHG-reduction target was not contingent on green hydrogen, which was being viewed as a “sweetener” during the period and was expected to contribute to its further decarbonisation only after 2030. “Catalytic” green hydrogen projects would, however, be implemented during the current decade, including one to repurpose a 60 MW electrolyser at Sasolburg, in the Free State, to produce 3.5 t of the clean energy carrier daily. The green hydrogen arising would most likely be used to support green mobility projects in South Africa, including the fuelling of green-hydrogen mining haulage trucks. The group would also pursue, in partnership, sustainable aviation fuel (SAF) opportunities prior to 2030, using green hydrogen in its FT process to produce jet fuel that was likely to attract a market premium from aviation companies. A study was currently under way through the so-called HyShiFT programme to produce SAF in partnership with Linde, Enertrag and Hydregen, initially under Germany's H2Global platform, into which the project would be bid. Sasol was also leading a feasibility study to explore the potential for the development of a green-hydrogen derivatives export hub at Boegoebaai, in the Northern Cape, and had entered into a green-steel partnership with ArcelorMittal South Africa, for Saldanha Bay and Vanderbijlpark. Grobler said that the reduction of electrolyser costs to produce green hydrogen to between $1/kg and $2/kg would be a key trigger for Sasol's future green-hydrogen strategy and indicated that such pricing was likely to emerge only after 2030. However, he noted that the incentives available in the US under the recently introduced Inflation Reduction Act would bolster the competitiveness of green hydrogen in that country and Sasol was, therefore, considering prospects for combining its FT technology with power-to-X solutions to produce green fuels and chemicals in that country. The immediate focus in South Africa, however, would be on replacing coal electricity with renewables and moving to secure the gas it required to displace coal in its production processes at Secunda. Recent drilling success in Mozambique had resulted in Sasol extending its gas supply plateau to 2028. Executive VP for energy Priscillah Mabelane said the extension had given the group more time to shore up its gas supply options and also reduced the pressure to conclude a liquefied natural gas (LNG) supply agreement, which she described as ‘Plan B' should it fail to secure more gas from southern Mozambiq...

Members of the South African Iron and Steel Institute (SAISI) have come out in full support of the proposed six-month ban on the export of scrap metal from South Africa. SAISI members include ArcelorMittal South Africa, Cape Gate, Columbus Stainless, Force Steel, Scaw Metals, SA Steel Mills and Unica Iron and Steel, while Safal Steel and Grinding Media are affiliated members. The temporary ban has been proposed by the Department of Trade, Industry and Competition as part of a broader three-phase intervention to tackle high levels of metals theft, which is estimated to be costing the economy about R187-billion yearly. The interventions are currently the subject of a public consultation process, during which there have been some warnings that the ban could negatively impact legitimate recyclers and informal waste collectors, as the criminal syndicates involved in copper cable theft are unlikely to heed the ban. Besides the export ban, the other components of the proposed first phase of the intervention include: an export permit system for semi-finished metal products to facilitate easier policing; the creation of an import permit system for furnaces and various other scrap transformation machines; possibly limiting export permits for semi-finished metal products to businesses that manufacture semi-finished products, and establishing a central repository to monitor metal theft from critical public infrastructure. During the second and third phases various regulatory amendments may be introduced to enhance the registration, reporting and enforcement regime for metal trading including limiting the number of ports that can be used to export scrap and the imposition of prohibition of cash-for-scrap transactions. Trade, Industry and Competition Minister Ebrahim Patel told lawmakers this week the temporary prohibition on exports of waste and scrap metal, and the creation of a permit system for the export of semi-finished metal, should lead to a material reduction in the theft of metal from the country's infrastructure as it will “eliminate or reduce one of the avenues for monetising stolen metal, that is its exportation”. Patel also denied that the export prohibition would have a significant negative impact on legitimate local upstream collectors and recyclers as the volumes of waste and scrap that are currently legally exported can be sold locally. “The temporary, two-month, prohibition on the export of scrap in 2020 did not cause serious harm.” SAISI concurs, arguing that the proposed intervention should “lead to a material reduction in the theft of metal from the country's infrastructure”. “These interventions will divert significant volumes of scrap metal to the local market, leading to lower prices, which will likely disincentivise theft and vandalism of infrastructure,” SAISI secretary-general Charles Dednam argues. SAISI believe the steel industry will benefit mainly from a reduction in theft and vandalism-induced service delivery interruptions, particularly as these relate to rail and electricity services. In addition, it will benefit from more domestic supply at better prices for mini-mills, foundries and metal processors. “Increasing scrap intake is essential to the cost competitiveness of the local primary steel producers – large and small – and is critical to the industry's environmental and carbon aspirations,” Dednam says.

State-owned freight logistics group Transnet has launched a High Court application through which it is seeking an order compelling China Railway Rolling Stock Corporation (CRRC) E-Loco Supply to release spare parts and components required to return 120 locomotives to service. Transnet said in a statement that the spare parts and components had been imported to service and maintain the 95 20E and 100 21E locomotives acquired from CRRC in 2012 and 2014 respectively. “The application provides for an urgent hearing to secure the immediate release of the spares to Transnet for use in the locomotives, and for the amount due by Transnet to CRRC for such spares, if anything, to be determined in due course,” Transnet said in a statement. Access to the spare parts and components, the utility added, would allow it to bring back to service 53 Class 20E and 67 Class 21E locomotives, which have been standing idle as a result of the inability to access the required spares and components. “In addition, it will contribute to timely maintenance of these two fleet classes,” the statement adds. The standoff with CRRC arose following Transnet's 2019 decision to halt the so-called 10-64 contract, for 465 diesel and 599 electric locomotives, in which CRRC participated along with three other original equipment manufacturers (OEMs). Transnet deemed the contracts, which featured during proceedings undertaken as part of the State Capture commission, to be “irregular and illegal”. The cancellation of the contracts has left Transnet Freight Rail (TFR) with a locomotive shortfall, which Transnet aims to address through the issuance of a new tender, possibly later this month. It has been amplified, however, by CRRC's refusal to provide Transnet with the spares required to maintain those locomotives already supplied to the utility. In July, Transnet CEO Portia Derby said that the impasse was partly responsible for as many as 300 locomotives having been “parked” and also indicated that an alternative OEM support strategy would be pursued for the existing fleet if the current deadlock with CRRC was not resolved. Several TFR customers have expressed dismay at the poor performance of the rail business over the past few years, owing to a shortage of locomotives and ongoing theft across the rail network, with TFR having lost a total of 1 500 km of overhead copper wire to theft in 2021/22 alone. Coal exporters have identified the poor performance of the rail service as a key reason for them having failed, thus far, to take full advantage of the super cycle conditions that have arisen for the energy mineral as a result of Russia's invasion of Ukraine. Steel group ArcelorMittal South Africa, meanwhile, reported that it was forced to close a blast furnace at Vanderbijlpark earlier this year, because intermittent rail deliveries had left it short of iron-ore. The group has resorted to receiving material by road, even though the logistics systems at its mills are specifically designed to receive bulk material by rail. Several large rail users have indicated that they will consider partnering with private rail providers should Transnet extend the sale of slots to third parties beyond the 18 general freight corridors identified for the initial phase of such sales. Derby indicated previously that TFR was committed to making slot sales a permanent feature of the rail business.

Arcelormittal South Africa has benefitted from improved pricing and lower debt costs during its interim period. The steelmaker has increased its profits by more than a fifth, but has opted not to declare a dividend. Business Day TV unpacked the performance with CEO Kobus Verster.

A new forum comprising Eskom, Transnet and domestic industrialists is to be established to improve collaboration between the two large infrastructure-focused State-owned companies and domestic manufacturers and suppliers. The initiative was unveiled by Ministers Pravin Gordhan and Ebrahim Patel in their respective Budget Votes on May 20 and comes at a time when domestic industry is warning that inadequate and erratic demand, together with power cuts and collapsing freight logistics, pose a threat to manufacturing entities and their employees. “Minister Pravin Gordhan and I have agreed to launch a forum to bring together Eskom, Transnet and other entities with industrialists in key sectors to enhance collaboration, advance planning, and problem solving. “This will enable a better climate for investment and job creation,” Patel said, stressing that energy and logistics were vital to the success of the country's industrialisation efforts. Gordhan added that the forum would foster a better climate for investment and job creation. Patel also announced that government would prioritise the protection of the electrical grid and rail network from “the continued threat of scrap metal syndicates”. “By the end of July, we will have developed and tabled a draft policy on scrap metal, which will introduce a blend of domestic and export measures to address illegal trade in copper cable and scrap metal.” Ahead of the speeches, Steel and Engineering Industries Federation of Southern Africa president Elias Monage warned that government's industrialisation ambitions would remain a “pipe dream” in the absence of stable and affordable electricity supply. Speaking at a conference held to assess progress on the Steel Master Plan, Monage said the power disruptions had become particularly challenging for downstream metals fabricators, which were also confronted with rising costs and low demand. He said low demand, especially from State-owned companies, had emerged as a key threat to many firms. National Union of Metalworkers general-secretary Irvin Jim even went as far as to describe Eskom, Transnet and ArcelorMittal South Africa as the country's new “triple challenge”, traditionally described as being poverty, unemployment and inequality. Jim argued that their underperformance and pricing policies were leading to the closure of small manufacturing firms and to the retrenchment of workers. Meanwhile, Solidarity deputy general secretary Marius Croucamp argued that the poor performance of Transnet and the ongoing vandalism of the rail network posed an existential threat to upstream and downstream companies and their workers. “If Transnet can't deliver, then this industry cannot delivery,” Croucamp said, stressing that the solution to the crisis lay outside of the master plan and required government intervention. Unless addressed, overcapacity would remain, he said, and there would be limited potential for new investment and job creation in the sector. Patel reported that he planned to convene an extended meeting of the Steel Master Plan oversight committee where these issue could be raised directly with himself, Gordhan, Finance Minister Enoch Godongwana and the infrastructure office in the Presidency. “Let's sit and just share ideas of what needs to be done and what can be done.”

Offshore / US GDP 6.5% , below expectations but the economy now larger than pre-pandemic / US moving forward with an infrastructure bill / The U.S. debt ceiling officially became operative again on Sunday after a two-year suspension / Amazon results see stock down 7% / Alphabet results & $50bn buyback / Microsoft results, LinkedIn does +$10bn Local / Tencent woes hit JSE (but all-time closing high on Thursday) / Results; Anglo Platinum, Kumba Iron Ore and Anglo American / Liberty2Degrees results / ArcelorMittal South Africa results / Treasury considering access to retirement savings

FNB's Chantal Marx talks the latest market movements. Kobus Verster, CEO of ArcelorMittal South Africa, unpacks its strongest half-year results in a decade. Bruce Williamson, CIO of Integral Asset Management, on PGM opportunities after the run-up.

Market Analyst at 27Four investments Nadir Thokan looks ArcelorMittal South Africa is planning to shut two mills and is reviewing operations at its largest plant, the mining agreement signed between government labour and business and China Factory PMI Falls to 47.3