Efforts to secure the continued operations of ArcelorMittal South Africa are progressing with commitment, as the company, government, and various organisations collaborate intensively to avert the closure of the steel giant’s facilities in both Newcastle and Vereeniging.
This development coincides with the International Trade Administration Commission of South Africa (ITAC) imposing safeguard duties on hot-rolled steel products.
As elucidated by ITAC, the South African Iron & Steel Institute (SAISI), an industry association, submitted an application on behalf of ArcelorMittal South Africa Limited, the predominant producer of the subject product within the Southern African Customs Union, requesting an investigation into remedial action in the form of a safeguard measure to counter the increased imports of hot-rolled steel products.
“Hot-rolled steel is used for the manufacturing of general engineering products such as containers, mining equipment, small and large bore pipes, earth moving equipment, gas cylinders, truck trailers, water tanks, etc. This product is normally used by products merchants, service centres, and fabricators who convert material into pipes and tubes primarily for construction projects. Smaller tubing is used for school furniture, while hot-rolled slit material is utilized for lip channels,” noted the ITAC.
With this context in mind, ITAC initiated this investigation through Notice No. 2333 of Government Gazette No. 50164.
“The Commission considered all comments, submissions and public hearings and made a final determination that, there were unforeseen developments which led to the increased volume of imports and that the surge in imports was causing serious injury to the SACU industry. The Commission further made a final determination to recommend to the Minister of Trade, Industry and Competition (DTIC) that safeguard measures be imposed and that the Commission be instructed to monitor the prices of the subject products in terms of section 18(a) of the ITA Act,” said the ITAC.
Furthermore, the Commission explained that a safeguard measure may be introduced to protect a domestic industry against foreign competition that, while not necessarily unfair, is overwhelmingly detrimental. As per ITAC, such measures can be implemented to address an unforeseen surge in imports that threatens to cause or is causing serious injury to a domestic industry. “Safeguard measures are temporary measures with timelines to allow a domestic industry to adjust and improve its competitiveness,” highlighted the ITAC.
A notice to give effect to this decision was published in the Government Gazette on 2 May 2025, as confirmed by ITAC.
Looking at the overall picture, the ITAC safeguard duties on hot-rolled steel products are a direct response to the import surge threatening ArcelorMittal South Africa (AMSA), particularly its Newcastle and Vereeniging facilities. This regulatory intervention aligns with a series of critical industry and government actions to address the severe financial and operational challenges facing AMSA, as detailed in reports by Newcastillian News. These efforts highlight the connection between import pressures and the broader crisis, emphasising the urgent need to protect the domestic steel industry.
As you will recall, on 6 January 2025, AMSA announced the wind-down of its longs business in Newcastle and Vereeniging, driven by unsustainable losses exacerbated by cheap steel imports flooding the market. As reported by Newcastillian News (AMSA Announces Wind-Down of Longs Business in Newcastle and Vereeniging), this decision was a stark indicator of the competitive pressures that ITAC’s safeguard measures aim to address. By curbing imports, the duties provide AMSA with a critical opportunity to stabilise its operations and mitigate further losses in the longs business segment, which is vital for producing hot-rolled steel products.
The import-driven crisis prompted an urgent response from labour, with the National Union of Metalworkers of South Africa (NUMSA) on 7 January 2025 calling for immediate collaboration to save jobs at AMSA’s Newcastle and Vereeniging plants. Newcastillian News (Steel Sector Crisis Deepens: NUMSA Urges Collaboration to Save AMSA Newcastle and Vereeniging Jobs) reported that NUMSA highlighted the devastating impact of imports on the steel sector, echoing ITAC’s findings of serious injury to the SACU industry. The safeguard duties directly support NUMSA’s push for job preservation by reducing the competitive threat posed by foreign steel, allowing AMSA to focus on retaining its workforce.
The scale of the crisis was further underscored on 16 January 2025, when Newcastillian News (ArcelorMittal Shutdown Could Lead to 20,000–25,000 Job Losses in Value Chain) reported that a potential AMSA shutdown could result in 20,000–25,000 job losses across the steel value chain. This projection aligns with ITAC’s determination that the import surge is causing significant harm to the domestic industry. The safeguard measures are thus a critical tool for preventing such widespread economic fallout, as they aim to restore market balance and protect the supply chain reliant on AMSA’s hot-rolled steel production.
Additionally, Government action intensified on 4 March 2025, with last-minute talks to avert the closure of Newcastle Works. As reported by Newcastillian News (Government in Last-Minute Talks with AMSA to Avert Closures at Newcastle Works), these negotiations reflect the government’s recognition that import pressures, as addressed by ITAC, are a core driver of AMSA’s challenges. By working to keep Newcastle Works operational, the government complements the safeguard duties, ensuring that AMSA can leverage the temporary protection to maintain its role as a key producer of hot-rolled steel products.
A significant step forward came on 31 March 2025, when AMSA secured a six-month deferral for its long steel business, providing a lifeline for Newcastle Works. Newcastillian News (Newcastle Works Lifeline: AMSA Secures Six-Month Deferral for Long Steel Business) noted that this deferral allows AMSA to align its restructuring efforts with the market protection offered by ITAC’s safeguard duties. The additional time is crucial for AMSA to adjust to the competitive landscape, particularly for its longs business, which is directly impacted by the hot-rolled steel import surge.
Then, on 1 April 2025, AMSA CEO Kobus Verster announced a R1.6 billion rescue plan for Newcastle Works, as detailed by Newcastillian News (AMSA CEO Kobus Verster Reveals Details Behind R1.6 Billion Rescue of Newcastle Works). This financial commitment aims to enhance AMSA’s competitiveness against imported steel, directly supporting ITAC’s objective of enabling the domestic industry to adapt. The rescue plan focuses on sustaining Newcastle Works’ production of hot-rolled steel products, reinforcing the importance of safeguard duties in creating a viable path forward for AMSA.
These developments collectively demonstrate how ITAC’s safeguard measures are intricately linked to the industry’s response to the import-driven crisis. By addressing the surge in hot-rolled steel imports, the duties provide AMSA with the breathing room needed to implement financial restructuring, retain jobs, and potentailly maintaining its critical operations in Newcastle and Vereeniging, safeguarding South Africa’s steel industry.
What are your thoughts on the above? Share your views in the comment section below.
9 Responses
Protection of a inefficient monopoly cannt last long before the downstream industry is dead
Better late than never, and at what cost. To the workers and their families. It just shows after all these months and years ANC just doesn’t care a damn…As they just Love percuting those who progress and who prosper…
It is hard breaking to see AMSA giant steel the last hope of SA steel producer undergoing such uncertainty, Mpumalanga Highveld steel and vanadium was not spared , it lays ruined in Witbank,
The iron and steel industry had been a large contributor to employment and Beneficiation of our endowed raw minerals contributing a large percentage to GDP. It is extremely disappointing and tragic that Government fails to act timeously until we have a crisis and threats of closure leading to Loss of jobs. Sheer incompetence and negligence from the DTIC. Hoping and praying that this valuable industry can be saved.
After the new government took over in 1994, the government took away protection.
A company across the street Metal box that manufactured cans could inport steel have it delivered, at a cheaper price, than the price asked by Iscor, later Arcelor Mittal.
I was affected then, Iscor redused labor from 22000 down to 8000 in 1999
I was then retrenched.
That does not include downstream employment.
Many companies in Vanderbijpark had to downsize or close
I am a South African business owner. STARTED from scratch.AMSA START FROM SCRATCH.
CONCENTRATE ON INTERNATIONAL MARKETS.
EXPORT EXPORT EXPORT.
PUT YOR HEADS TOGETHER AND GO FOR IT.
Duties today serve no purpose. Take away all the duties, close AMSA who have not reinvested in their production equipment and therefore are slow and expensive. Already cost 1.5 billion in rax payers money in the last few weeks. The jobs lost will very soon be replaced by a huge increase in steel manufacturing because SA will be more competitive in the world market. We were competitive but have lost that through bad governance. We used to make tractors, farm implements, military vehicles, mining equipment on a much bigger scale. Manufacturing is the back bone of a country. Look at Germany, Turkey, China, Spain etc.
Absolute rubbish, why on earth would one attempt to protect an antiquated producer who cannot compete with the rest of the world in either price or quality, both actually? It is to the ultimate detriment of all South Africans, as tax payers money will be used to prop up another failed entity and will lock even more local product producers into a declining local market ……. let it die the death it deserves!
As a steel trader of 27 years…. This is what Arcelor Mittal have done in other countries more times than I can count. The safe guards will do nothing other than push up the price of steel for the end users/customers it will not increase demand or output, they will continue to take government bail outs until they eventually close the plants.