ArcelorMittal to Shut Saldanha Steel Plant in South Africa

Earlier in July this year, the company had warned of retrenchments of up to 2,000, as part of large-scale restructuring of its operations.

SEATTLE (Scrap Monster): Steel major ArcelorMittal SA announced its decision to shut down its steel plant in Saldanha town of South Africa. The shutdown is feared to affect hundreds of workers. The Luxembourg-based steelmaker had reported net loss of $539 million in the most recent quarter of 2019.

According to company press release, the decision follows an operational review of the steel plant, which concluded that it has lost its competitive cost advantage, mainly due to high raw material costs and regulated prices. It must be noted that the plant has been suffering severe financial losses. The process of winding down the plant to care and maintenance mode is expected to begin immediately and the shutdown is expected to complete in Q1 next year, it said.

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The difficult decision was taken in the context of constructive ongoing engagements with key stakeholders, the press release said. Also, the contractual sales orders from Saldanha will now be fulfilled from the Vanderbijlpark Works.

Earlier in July this year, the company had warned of retrenchments of up to 2,000, as part of large-scale restructuring of its operations.

Meantime, the South African government expressed deep disappointment over ArcelorMittal’s decision. The Department of Trade and Industry noted that the decision is quite unfortunate, especially in the midst of significant efforts by the Government and other public agencies to provide additional support in the form of reduced energy and logistics cost to the company in continuing the Saldanah operations.

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