The future of ArcelorMittal South Africa’s (AMSA) Newcastle Works remains a critical issue as South Africa’s steel industry battles severe pressure.
However, the Department of Trade, Industry and Competition (DTIC) has now reported progress in efforts to stabilise AMSA, with negotiations between the steel giant, the broader ArcelorMittal Group and the Industrial Development Corporation (IDC) still underway.
This emerged during a briefing on Wednesday, 10 June 2026, when the DTIC and stakeholders from the steel and metal fabrication sector appeared before the Parliamentary Committee on Trade, Industry and Competition.
The session focused on the crisis facing the steel sector, including trade protection, electricity pricing, local procurement, competitiveness, employment, and the proposed support needed to prevent further industrial decline.
Lawmakers welcomed the progress reported by the DTIC, particularly around trade remedies, electricity price negotiations and strategic support aimed at easing pressure on AMSA.
AMSA did not deliver a formal presentation during the briefing, as the company remains under a cautionary announcement linked to its ongoing negotiations with the IDC.
As previously reported by Newcastillian News, AMSA issued a cautionary announcement on Wednesday, 3 June 2026, through the Stock Exchange News Service (SENS) of the Johannesburg Stock Exchange Limited. The notice advised shareholders that AMSA, the broader ArcelorMittal Group and the IDC remained in talks over a potential transaction.
However, no definitive agreement has yet been concluded, meaning the timeline initially anticipated by the market has shifted.
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Despite these delays, the DTIC told the committee that work is continuing to address key bottlenecks affecting AMSA and the wider steel sector.
This includes the department’s Industrial Development Strategy, which seeks to support the finalisation of the AMSA transaction while assisting the company through its restructuring process.
For Newcastle, the matter is especially significant. AMSA’s Newcastle Works has already been mothballed as part of the company’s restructuring and performance improvement efforts, placing renewed focus on the town’s industrial future and the jobs linked to the operation.
In its submission, the DTIC confirmed that the ArcelorMittal Group, AMSA and the IDC remain engaged in discussions around the proposed transaction.
However, the department stressed that any deal remains subject to definitive agreements and the required regulatory approvals.
The DTIC also reported progress on customs duties and related trade remedies, which are seen as vital to protecting local producers from unfair competition and underpriced imports.
“There is further progress with the negotiation of a reduced electricity tariff, which is awaiting approvals from NERSA and Eskom,” added the DTIC during its presentation.
While these developments offer some relief, the portfolio committee warned that temporary measures will not be enough to rescue South Africa’s steel sector.
Committee members called for a stronger and more coordinated state-led response, including the strict enforcement of localisation and public procurement policies.
They also urged tighter border controls to curb illicit and underpriced steel entering the country.
Industry stakeholders warned that the sector continues to decline due to global competition, weak domestic demand, policy misalignment, logistical failures, rising production costs and cheaper imported products.
Furthermore, electricity prices remain one of the most urgent concerns, while weak rail and freight systems continue to place further pressure on producers. Stakeholders also pointed to falling capital investment and the growing challenge of global steel oversupply.
The scale of the decline was made clear during the briefing. Domestic steel consumption per capita has dropped from a peak of 92kg to just 67kg, while manufacturing’s contribution to national GDP has fallen from more than 16% to 12.8%.
Further figures showed that crude steel production has fallen by 33% since 2018, while finished steel exports have collapsed by 63%.
Stakeholders warned that without serious reform to electricity pricing, procurement enforcement, logistics and trade protection, South Africa risks losing even more of its industrial capacity.
Several interventions were proposed, including binding commitments to enforce local public procurement through public infrastructure spending and supplier development programmes linked to state-owned enterprises.
Other proposals included targeted support for vulnerable sub-sectors such as wire and scrap metal, development finance and tax incentives for downstream industries, improved rail and freight logistics, and stronger enforcement of trade remedies.
The Chairperson of the committee, Mzwandile Masina, said the sector could still be saved, but only through coordinated action.
“The steel sector must be saved. However, this requires holistic government support and industry investment to ensure that a modern and competitive sector can emerge. Therefore, the DTIC and its entities should prioritise the review of the Master Plan and affected interventions.”
For Newcastle, the negotiations between AMSA, the IDC and the state are about far more than a corporate transaction. They are directly tied to jobs, industrial stability and the economic future of one of the town’s most important employers.
For South Africa, the process has become a test of whether government can protect what remains of the country’s manufacturing base while building a more competitive steel sector.
The coming months will be crucial. If the DTIC’s Industrial Development Strategy is to produce real results, it will need to move quickly from policy discussion to firm execution.
For AMSA Newcastle Works and the broader steel sector, the stakes remain high. Without decisive intervention, South Africa risks losing more manufacturing capacity at a time when industrial recovery is urgently needed.
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