ArcelorMittal CEO Warns of ‘Small Window’ to Avert Crisis Amid Job Cuts

The company forecasts a 5% revenue drop in 2024 due to reduced asset utilization and weaker net realized prices.

SEATTLE (Scrap Monster): According to the South African Communist Party, SACP, the medium-to long-term, fallout could put an estimated 25 000 to 100 000 livelihoods at risk.

Verster said after Friday’s meeting in Vanderbijlpark that there is ‘only a tiny window of opportunity to save the situation’ amid the company’s dire financial situation.

AMSA reported its worst financial performance in recent history in 2023, citing sluggish economic growth, high energy costs, and logistical challenges – including issues with Transnet and Eskom – as major contributors to its decline.

The company forecasts a 5% revenue drop in 2024 due to reduced asset utilization and weaker net realized prices.

Verster also pointed to structural issues within the steel manufacturing sector.

Minister Meth expressed ‘cautious optimism’ following the initial meeting, acknowledging the challenges but stressing the government’s commitment to exploring interventions to mitigate job losses.

Meth described the discussions as productive but underscored the need for continued collaboration.

The looming job cuts and financial pressures at AMSA highlight the struggles facing South Africa’s steel industry, which has been impacted by global competition, rising operational costs, and regulatory challenges.

Meanwhile, the SACP said it ‘will mobilise our structures, workers and communities in Newcastle, Vereeniging, eMalahleni and beyond to take militant action against AMSA’s plans.’

The Communist Party said stopping this from happening was not just an economic imperative but a matter of national security to ensure the survival of domestic steel production and supplies to various manufacturing sectors.

Further, the SACP said the government must not abandon critical industrial policy instruments, such as the Preferential Price System and export tariffs on scrap metal, highlighting that these measures are essential to ensure that the scrap metal resource above the ground is transformed into value-added products, including reasonably priced long steel products.

The party wants decisive action to be taken against illegal scrap metals and trade, particularly the looting of public infrastructure and theft.

Courtesy: www.citizen.co.za