South African government's steel investment threatens ArcelorMittal mills

The South African government's plan to invest billions of dollars in steel to build 14,000 kilometers of new transmission lines has sparked debate about the fate of ArcelorMittal South Africa's (AMSA) Newcastle steel mills. CEO Kobus Verster has hinted that a decision to close the mills may be imminent and that the government's investment may be too late to save the situation.

AMSA, a major player in the country's steel industry, is currently debating whether to close or continue its long steel operations. This discussion follows the company's agreement in February to postpone the closure of its Newcastle plant for six months. The decision to postpone was contingent on government commitments to address infrastructure issues and streamline policy frameworks that have hampered the industry's growth.

The Newcastle factories, which currently employ around 3,500 permanent and contract workers, have been in the spotlight due to their uncertain future. Verster emphasized that while the plant is being kept operational to mitigate potential social repercussions, its long-term viability remains uncertain without a sustainable business outlook.