Media statement issued by electric steel producers Cape Gate, Scaw Metals, Fortune Steel, Unica, Veer Steel Mill and Coega Steel.
A representative group of local Electric Steel Producers have written to Minister of Trade, Industry and Competition, Parks Tau, urging him to reinstate a ban on the export of scrap metal. The ban will ensure the sustainability of the local steel industry through a reliable supply of scrap material. The local industry operations are being affected by a chronic shortage of scrap metal, used in the production of new steel. The shortage is putting downstream supply at risk.
With ArcelorMittal’s Newcastle long steel plant set to close, electric steel producers are expanding their production capacity to fill the gap. They are well-positioned to meet the majority of the country’s steel requirements. Electric steel producers use scrap steel from end-of-life products such as discarded washing machines, construction material and vehicles to produce new steel in a sustainable manner.
The industry is calling on the Department of Trade, Industry and Competition to reimpose the ban so as to give space and time for further engagements around the future of long-term regulatory support like the Price Preferential System and the scrap export duty. Appropriate regulatory support can maintain a thriving local steel industry that supplies key sectors such as mining, construction, and automotive manufacturing.
Electric Steel Producers currently employ over 5 000 people, while downstream industries support tens of thousands of jobs. A scrap export ban has been implemented before and its reinstatement would be a relatively easy and inexpensive measure that can boost the industry and signal its resilience after the pending ArcelorMittal Newcastle closure.
The Electric Steel Producers thank the government for their continued engagement with the industry. The producers remain eager for further discussion on this critical issue, and hope further cooperation can safeguard an industry that contributes significantly to the country’s economy.
