Scaw Metals has announced a R5 billion investment in a new steel mill in Johannesburg, aiming to reduce South Africa’s reliance on steel imports by producing hundreds of thousands of tonnes of locally manufactured steel products. The investment positions Scaw to replace approximately R4 billion worth of imports annually, especially targeting flat steel products that are largely imported due to local supply constraints.
Scaw’s new facility is expected to produce between 300,000 and 500,000 tonnes of flat steel annually, addressing over half of the 600,000 tonnes currently imported to meet demand. CEO Doron Barnes highlighted the new mill’s advanced technology, which will focus on producing thin gauge hot-rolled steel, a product that has typically been sourced from international markets. The mill was developed in partnership with Italy’s Danieli Group, a major supplier in the metal industry, and forms part of President Cyril Ramaphosa’s national investment drive.
Funded primarily by Scaw and a consortium of financial partners, the project involved local spending of R2.5 billion and created 3,500 jobs over its two-year construction. This development aligns with recent efforts by the government to strengthen local manufacturing, including a 20% export tax on steel scrap, which helps lower input costs for domestic producers. Scaw has also invested an additional R1.6 billion into upgrades at its existing operations.
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