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An unanticipated increase in steel demand in South Africa, Africa overland markets and the associated supply chain shortages have prompted ArcelorMittal South Africa to continue the Vaal Meltshop (Vereeniging) operations. But is this good news for the Newcastle based division?
Coming as a sigh of relief for the steel giant, as operations were initially scheduled to be placed under care and maintenance at the end of December 2020. The company explains ArcelorMittal South Africa will now increase the output from its electric arc furnace (EAF) in Vereeniging in the short term, with the possibility of staying at these higher levels if warranted by future demand.
Chief Executive Officer of ArcelorMittal South Africa, Kobus Verster explained, “We are employing all our resources to address the current steel shortages, and the Vaal Meltshop will go a long way in addressing the low supply chain stock levels in the Long Products markets.”
The Vereeniging operation has been running at about half its capacity in recent years and pushing this to full capacity would mean a significant increase in billet production. This will be used for speciality input material to the Gauteng operations, including Leeuwkuil Mill, tubular products, the forge operations and the small section mill in Tshwane.
Moreover, it is important to note; this will also help reduce the production requirements from the company’s Newcastle operations, which will ensure more steel can be supplied to its long steel customers.
According to ArcelorMittal SA, had the Vaal Meltshop been placed in care and maintenance, 85 jobs would have been potentially lost. Fortunately, these jobs can now be retained, and there is the possibility of an additional 30 people being employed to run the plant at full capacity.
Moreover, continued contracts will also ensure further potential job losses are evaded at service providers.
The company explains the Vaal Meltshop underwent extensive maintenance during December to ensure the plant remains reliable when production levels are raised. The volumes of critical consumables have also been increased, in order to mitigate the risk of supply shortages which might influence the operations. The team is confident they can be in full operation towards the second half of February 2021.
Concluding, Verster highlights, “With the Vaal Meltshop fully operational and supplementing our three blast furnaces in Newcastle and Vanderbijlpark, we expect that we will be more than able to meet the steel requirements in South Africa and neighbouring countries in the coming months.”
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One Response
Let’s hope this will be the truth as employees are struggling alot especially at Arcelormittal Newcastle with that short time they implemented leaving lot’s of their employees with debt.
How can you survive with salary cut of 15 – 25%?