South Africa is stepping up measures to support the steel industry

The South African government is stepping up measures to support the steel industry as the country’s steel sector faces global pressure. This was reported by Business Report.

At a briefing for the relevant parliamentary committee, the Department of Trade, Industry and Competition (DTIC) outlined a series of measures aimed at protecting steel producers, boosting demand for locally produced steel products and accelerating the sector’s transition to greener technologies.

South Africa’s steel industry remains central to the country’s industrial ambitions, but is facing mounting pressure due to weak economic growth, high electricity costs, cheap imports and global overcapacity.

Tebogo Makube, acting deputy director-general for sectors at the dtic, stated in particular that the government’s aim is to deepen domestic steel production and strengthen downstream industries that rely on local steel products.

He acknowledged that the closure of the ArcelorMittal South Africa plant in Newcastle had disrupted supply chains, particularly for the automotive sector, forcing the government to temporarily allow imports of certain steel products.

However, reducing dependence on imports remains a priority. According to Makube, it is also important to be able to increase local content requirements in certain manufacturing sectors.

The government is working with the Department of Energy to address the issue of electricity costs. Meanwhile, the South African International Trade Commission (ITAC) has stepped up trade defence measures.

To support the transition to green steel, the government is developing a roadmap for the steel sector, focusing on decarbonisation, the integration of renewable energy sources and investment in new technologies, such as electric arc furnaces and direct reduction iron production.

The government is also exploring the possibility of establishing green industrial zones for steel production in Saldanha Bay and other strategic industrial hubs.

At the same time, the relevant committee remains concerned about a number of unresolved issues affecting the sector. These include state-owned enterprises’ abandonment of supplier development programmes, the impact of pricing policies on manufacturers operating in the processing sector and small businesses, as well as the need to strike a balance between market trends and state intervention.

It should be recalled that in May this year, South Africa imposed increased import duties on certain types of steel products (ranging from 10% to 30%) in order to protect its own steel industry.