According to local media reports, ArcelorMittal South Africa (AMSA) has begun the shutdown of its long steel division after 78 years of activity, starting to send notices to employees as of September 1, 2025.
AMSA CEO Kobus Verster explained that the steel market has become unsustainable. He noted that international steel prices have been at record lows for two years, while in South Africa sales volumes dropped by 11 percent and prices by seven percent, leading to a revenue decline of 17 percent. Hence, the division has recorded a loss of around ZAR 1.7 billion ($96.38 million) since 2023. At the same time, competitors with electric furnace-based steel production have benefited from a local pricing system that favors scrap consumption, unlike AMSA which still uses a more polluting iron ore-based approach. On the other hand, the collapse of Transnet’s rail system has forced the company to rely on more expensive road transport. Rising imports and higher electricity tariffs added further pressure.
The company has been in discussions with the government and the Industrial Development Corporation (IDC) to find a solution, as previously reported by SteelOrbis. Earlier this year, the IDC provided ZAR 1.7 billion in emergency funding to keep the Newcastle operations running until September. However, no long-term rescue plan was agreed upon, leaving AMSA with no choice but to close the division.