IDC investing R1-billion in steel industry
Kingsley Dell-Robertson, Eastern Cape Regional Manager for the Industrial Development Corporation (IDC), said innovation would be key, as South Africa battles it way out of the current steel crisis.
Commodity prices have stagnated during the past 12 months, and steel obviously hasn't been immune to this. That has been compounded by the decline in global demand and oversupply of the product. Dell-Robertson said it was time to start thinking smart.
So, what is it that will constitute innovative thinking, as the South African industry tries to worm its way out of this mess.
"Through these challenging times for the steel industry, innovation is key. The value-chain – primary steel mills, fabricators and domestic manufacturers at different levels are innovating and finding novel ways of staying sustainable and competitive while contributing to the economic growth story of the Eastern Cape region," said Dell-Robertson.
Whatever those plans are, they will have to include securing major manufacturing and infrastructure projects, along with the expansion and diversification of the automotive sector. Experts believe that will help curb the negative effects of the crises.
The IDC said this required an investment of about R1-billion, probably more, to build five mini steel mills. One of those mills is currently in operation in Port Elizabeth.
Agri Steel manufactures steel billets. Hassan Khan, Director at Agri Steel SA explained what this project was all about.
"Agni Steels SA could only roll out its second phase expansion plans because of government's initiatives. We applaud government for bringing about an import duty on cheap steel being imported into South Africa," said Khan.
"The most important factor sustaining the steel manufacturing industry in South Africa and jobs are mainly because of government's initiative, by implementing the Price Preference System (PPS). This initiative will contribute to a greater job creation in South Africa," added Khan.
Growth in the entire South African context is important, but the bigger picture will only become a reality if the regional nodes are well taken care of. For Dell-Robertson, reviving the industry in the Eastern Cape is a priority.
"Industrialization in the Eastern Cape is key to economic growth - both provincially and nationally. Manufacturing still contributes significantly to the economy and for our province this is largely driven by the needs of the automotive sector," added Dell-Robertson.
"This industry is only set to grow with new investments such as our joint venture with BAIC (Beijing Automotive International Group) as just one example of the IDC's investments in this province," added Dell-Robertson.
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