8chan/8kun QResearch SOUTH AFRICA Posts (1)
#20887035 at 2024-05-19 15:07:36 (UTC+1)
Q Research South Africa #12: Joburg Blast and Highjacked Buildings Edition
>>20887022
>>20887028
"ArcelorMittal SA sounds warning to labour as it mulls closure of steel operations"
https://www.dailymaverick.co.za/article/2024-05-02-arcelormittal-sa-sounds-warning-to-labour-as-it-mulls-closure-of-steel-operations/
02 May 2024
The company will make a final decision by August on whether to keep open or shut down its loss-making long-steel operations in Vereeniging and Newcastle. ArcelorMittal has argued that curbing above-inflation pay rises in the steel industry is required to keep operations financially sustainable.
As SA's struggling steel industry is locked in pay rise negotiations with trade unions and races against time to stabilise labour relations, the country's largest steel maker has fired a two-fold warning to workers.
ArcelorMittal has urged SA's nearly 400,000 steel workers to either moderate their pay rise expectations and sympathise with the industry's difficult financial situation or continue to push for high pay rates and risk job losses.
ArcelorMittal SA CEO Kobus Verster is emphatic that the steel industry's heydays - when steel companies were profitable and could easily pay above-inflation wages - are long gone.
But workers and their representative trade unions are not adjusting to the new, hard reality, Verster said.
And now, ArcelorMittal, which employs over 9,000 workers and contractors (paying them at least R5-billion annually), is at risk of shutting down its loss-making long-steel operations in Vereeniging (Gauteng) and Newcastle (KwaZulu-Natal).
At a generic level, ArcelorMittal wants to see state-owned transport group Transnet move fast with implementing reforms to its port and rail operations. The dysfunction and unreliability of Transnet's rail network have meant that ArcelorMittal is transporting raw materials to its factories by road, which is more expensive.
ArcelorMittal relies heavily on Transnet Freight Rail to transport 91% of the iron ore and 100% of the coking coal consumed at its Newcastle and Vanderbijlpark factories to produce steel.
Then there are Eskom's blackouts, which delay ArcelorMittal's steel production process. Higher stages of load shedding mean that its factory in Vanderbijlpark is, at times, asked by the power utility to engage in load curtailment for eight hours a day. This effectively reduces its use of electricity.
Fixing Transnet and Eskom, entities that have been dysfunctional for more than a decade, will not happen overnight.
ArcelorMittal has been criticised for being naive in believing that logistic and energy reforms could be delivered by the government within the six months that it has deferred its shutdown decision.
Asked about this, Verster would only say that he remains positive about the ongoing discussions with Transnet, Eskom and government officials, saying that talks are "very proactive and solutions-driven". He said ArcelorMittal would not keep its long-steel business open "based on promises".
If ArcelorMittal decides to keep its long-steel operations open, big investment plans are in the offing. These include ArcelorMittal reducing its reliance on Eskom by making investments in renewable energy sources, as part of its 2030 decarbonisation plan. This entails the company building a 200MW renewable energy facility at its Vanderbijlpark plant, making use of the land available.
Werner Venter, the chief technology officer at ArcelorMittal, said the renewable energy facility will power its factories and reduce Eskom-related electricity costs and ArcelorMittal's emissions.
"We are hoping to break ground on the project in 2024. There are already permit, environmental and local authority approvals. We are just waiting for a grid connection from Eskom," said Venter.