LETTER: One-size-fits-all does not fit the steel industry
Large, primary steel producers require a very different policy to that of, say, the steel scrap sector
The SA steel industry is a highly complex and diverse sector of the economy. It consists of large, primary steel producers such as ArcelorMittal SA, which produces steel from iron ore in blast furnaces; and Scaw and Cape Gate, which produce primary steel by recycling steel scrap in electric arc furnaces, and numerous foundries producing a range of products from steel scrap in induction and electric arc furnaces.
The primary cost elements in steel production are raw materials, labour, energy and capital. The cost make-up varies significantly across the steel industry. For example, the large, primary steel producers will have a high proportion of raw materials costs, with energy and capital also significant elements in their cost makeup. Labour is typically a single-digit percentage of total costs for the large, primary steel producers...
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