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ArcelorMittal South Africa announces plans to close long-staple steel plants by September

ArcelorMittal South Africa announced on Thursday that it will still close its long-losing steel operations by September as discussions with the government failed to provide a solution.

Steelmaker reported a headline loss for the first half of the year of 1.014 billion Rand ($56.4m), a little less than its previous loss report, which was 1.1 billion Rand. This is due to low sales and prices that have remained constant.

Due to the weak demand in South Africa, its revenue dropped 17% to 17 milliards rand. Sales volumes also declined 11% at 1.05 million metric tonnes.

ArcelorMittal South Africa, which originally announced the closure of two long steel plants near Johannesburg and Newcastle in November 2023 to allow for talks with the government, has delayed the closing twice. The goal is to save 3,500 direct job.

The company stated that "in the absence of a viable solution, the winding down of the longs' business is scheduled to take place on 30 September 2025."

Parks Tau, South Africa's Trade and Industry Minister, told lawmakers that on July 4, the government is in a "firefighting" mode as it attempts to avoid plant closures.

The company claims that its long-standing steel operations are under pressure from a weak local market, high electricity rates, poor logistics, and competition from mini-mills for recycling scrap metals in the area, as well as imports from China.

Long steel plants provide rail, road and bars for construction, mining, manufacturing and other sectors, as well as automotive components.

(source: Reuters)