Posted: October 10, 2024
The Deputy Minister of Trade, Industry and Competition, Mr Zuko Godlimpi says the steel sector should be central to South Africa’s industrial policy and that more emphasis should be placed in understanding the manufacturing capacity of South Africa. Godlimpi was speaking during his visit to Scaw Metal Group in Germiston, Gauteng.
“Centralising the steel sector should be a priority across the state and not only for the Department of Trade, Industry and Competition (the dtic). Understanding the manufacturing capacity of South Africa will lead to identifying the bottlenecks from both demand and supply side point of view and what can be implemented to get the system going again,” said Godlimpi.
He pointed out that there is also a need to build a sustainable rail corridor that will be essential to South Africa’s economic development and serves as a major logistics enabler for the country’s import and export freight traffic. He said this too would lead to a steel export strategy that was highlighted in the South African Steel and Metal Fabrication Master Plan.
The Chief Executive Officer of Scaw Metals, Mr Doron Barnes, said in the next three to five years their objective is to reach one million tons per annum production of liquid steel at Union Junction from the current 650 000 tons. He said this would increase the employees on site to 1 200 and will be supported by a R1.5 billion investment in a second electrical arc furnace.
“We want to secure our electricity supply by investing R3 billion in a co-generation unit on the site to produce 68MW, net 60MW into operations. We intend to enhance our margins by extending the hot strip mill downstream and investing in a R2 billion cold rolling plant including galvanising, pickling and colour. This plant will produce 15 000-20 000 tons of rolled thin gauge material, and be a full import replacement and increase the employee complement by a further 200 people,” he said.
Barnes emphasised the importance of dialogue with all stakeholders, especially the dtic and the Industrial Development Corporation (IDC), as it gives Scaw the opportunity to table their views in order provide input into issues that affect the company or might be relevant for opportunities that may arise.
IDC provided Scaw Metal with R500m funding as part of a R1.5 billion club loan with Absa and Investec each putting in R500 million.
The Deputy Minister of Trade, Industry and Competition, Mr Zuko Godlimpi during his visit to Scaw Metal group factory in Germiston, Gauteng.