CHARLES DEDNAM: A healthy economy needs a healthy steel industry
A revitalised SA steel sector can be an effective enabler for the country’s much-needed economic recovery
Steel is an essential material; fundamental to every aspect of our lives, from infrastructure and transport to the humble tin-plated steel can. Our largest buildings and most precise instruments are made of steel. Steel is strong, versatile, and infinitely recyclable. It has been the foundation of the last 100 years of progress and will be equally fundamental to meeting the challenges of the next 100.
Average use per capita globally has steadily increased, from 150kg in 2001 to about 230kg now. However, SA’s average per capita use has dropped by 37% from its peak in 2013 to just 67kg today — less than one-third the global average, reflecting the country’s struggling economy and the decline in its manufacturing capacity. SA urgently needs to regain economic momentum, and with steel being crucial to its ability to do so, it is appropriate for the government to ensure this is possible.
Steel is every developing nation’s catalyst for growth and development. It is essential in energy, construction, automotive and transportation, infrastructure, packaging and machinery. Steel’s properties make innovation possible and turn possibilities into reality. Steel has one of the highest strength-to-weight ratios of any construction material, which has advanced engineering to almost unbelievable levels.
The housing and construction sector is the largest consumer of steel, using more than 50% of global production. In SA, the building and construction sector more than 62% of all steel destined for the domestic market. New, lightweight steel makes applications lighter and more flexible while retaining the required high strength. In addition, lightweight steel structures adopt technologies with a reliable quality that can bear strong wind, heavy snow and rain.
Modern steel products have never been more sophisticated, from smart-car designs to hi-tech computers, from the latest medical equipment to satellites. Architects can create any shape or span they desire and design steel structures to suit their innovative designs.
SA steelmakers can develop the metal to satisfy sophisticated market demand, and the country has the capability and technology to excel in advanced product design. SA is especially active in designing, manufacturing, and supplying lightweight steel structures.
Steel provides valued employment, training and development. A job in steel places one at the centre of some of the most important technical challenges of today.
Steel companies generate jobs and substantial tax revenue, which benefit the local communities in which they operate. Globally, more than 6-million people work directly for the steel industry, about 28,000 of them in SA. The industry offers employees the opportunity to further their education and develop their skills, providing 7.18 days of training per employee in SA in 2020.
Those in jobs supported by the steel sector spend their wages on consumer goods and services. This spending supports further economic activity in the various commercial sectors with an implied ratio of 1:7 for induced jobs resulting from the activity in the primary steel sector.
The steel industry cares about the health and wellbeing of the people who work with us and live about us. The steel industry is committed to the goal of an injury-free workplace and organises an industrywide safety audit on Steel Safety Day every year. The injury rate per million hours worked has decreased by 82.3% over the past 15 years.
Steel is local; we create jobs, build communities, and we drive a local economy for the long term. Many steel companies build roads, transport systems, schools and hospitals in the areas about their sites. Once established, steel plants operate for decades, providing long-term stability in terms of employment, community benefits and economic growth.
The steel industry does not compromise on its environmental responsibility. Steel is the primary material used in renewable energy: solar, tidal, geothermal and wind. It is the world's most recycled material, with about 630Mt recycled annually. In 2020, the recovery and use of steel industry co-products reached a worldwide material efficiency rate of 97.86%. About 90% of the water used in the steel industry is cleaned, cooled and returned to source. Water returned to rivers and other sources is often cleaner than when extracted.
We recognise that people are interested in steel and its effect on the economy because of its critical role. Therefore, we are committed to being open, honest, and transparent in all our communications about our industry, its performance, and its impact. The steel industry publishes data on production, demand and trade at national and global levels, which is used for analysing economic performance and forecasting. It participates in the Organisation for Economic Co-operation & Development, the International Energy Agency and UN meetings, providing all the information required on key industry topics that affect society. In addition, we participate in the Steel Master Plan process and the National Development Plan at a national level.
We believe there are ways to optimise installed manufacturing capacity, drive down the fixed-cost component of SA manufacturing and deliver more competitive steel products. And we wholeheartedly believe that a revitalised local steel sector can be an effective enabler of SA’s much-needed economic recovery — if we all work together to make this happen.
• Dednam is secretary-general of the SA Iron & Steel Institute.
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