ArcelorMittal in Talks Over Closure of its Newcastle Mill

SEATTLE (Scrap Monster): According to reports, ArcelorMittal South Africa is discussing the possible closure of its Newcastle mill with the Industrial Development Corp. (IDC) and the Department of Trade.

A loss-making steel operation

It should be mentioned that the steel factory in KwaZulu-Natal's eastern province has been consistently reporting losses. The corporation attributed its losses primarily to rising power costs, inadequate safeguards against low-cost Chinese imports, and unfair reductions on scrap metal prices.

Will the plants close by end-September?

ArcelorMittal South Africa (AMSA) said earlier in April of this year that IDC, one of the company's biggest shareholders, intends to buy a bigger portion in the business. In the upcoming days, a final decision regarding this idea is anticipated. The mill and another long-products steel mill in Vereeniging are scheduled to close by the end of September this year, according to the company's timeline.

Impacts of potential shutdown

Approximately 3,500 direct employment and thousands more indirect jobs are anticipated to be impacted by the proposed shutdown. These plants produce steel grades that may need to be imported since they are not produced locally.

The goal of the discussions, according to the commerce department officials, is to keep mills from closing. ArcelorMittal did, however, restate that unless a solution is found, the mills will close.

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