Government attempts to keep loss-making South African steelmaker ArcelorMittal SA (Amsa) alive are killing the country's downstream steel industry and costing thousands of jobs, says Gerhard Papenfus, CEO of the National Employers Association of SA (Neasa).Amsa, the country's only steel producer, is protected by 20% import duties, forcing manufacturers in the domestic steel sector to pay cripplingly high prices for steel.The world selling price of steel is $513 (R7,800) a ton. Amsa's cost price to make the same steel is $632 a ton. Its selling price is a whopping $676 a ton."When the world steel price goes down the South African downstream doesn't have the benefit, because we pay Amsa at their selling price," he says. "So it's expensive steel."This is playing havoc with the more than 2,000 businesses in the sector that Neasa represents."In order for Amsa to survive, downstream businesses pay 20% import duties. They have access to cheaper steel but it's made impossible for t...

Subscribe now to unlock this article.

Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).

There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.

Cancel anytime.

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.