ArcelorMittal South Africa (ArcelorMittal SA) will halt long steel production by the end of the second quarter of 2025 after failing to reach an agreement with the government to prevent the plant’s closure.Â
The company stated it has no choice but to proceed with the final wind-down of its longs business. Shutdown of the blast furnaces is set to begin in early March, with the last steel production expected in late March or early April. The business will transition to care and maintenance by the end of the second quarter.
ArcelorMittal SA cited a lack of progress on key issues, including the continuation of the scrap export tax and a preferential pricing system that gives mini-mills using electric arc furnaces a competitive advantage. Introduced in 2013, the pricing system mandates that scrap exporters sell to local producers at discounted rates, benefiting smaller mills at the expense of primary steelmakers. The export tax, implemented in 2021, was intended to replace the pricing system and curb scrap exports but has failed to address structural challenges such as rising costs and competition from cheaper imports, particularly from China.
Other challenges, including high rail tariffs, unchanged energy costs, and the absence of protective measures on steel products, have further pressured operations.
The closure will impact all long steel plants, including Newcastle Works, Vereeniging Works, and ArcelorMittal Rail & Structures. Despite extensive negotiations since early 2024, ArcelorMittal SA said conditions have not improved but instead worsened, leaving the company with no viable path to continue long steel production.
