The South African government plans to establish a new carbon steel plant in order to introduce more competition into the local steel market and therefore to compete with high domestic prices.
According to the Trade and Industry Department's recently released national industrial policy framework (NIPF), the state has started the feasibility study to access the viability of different locations and technologies for the establishment of the new carbon steel. The study is expected to be finalized by March, 2008.
The former state-owned Iscor, which was bought by Lakshmi Mittal after the privatization, has become the dominant steel producer in the South African market. The company's position even strengthened after Mittal Steel and Arcelor merged in 2006, forming the world's largest steel producer.
The government's planned plant is expected to reinforce the competition in the local market.