A worker stacks steel pipes in the western Indian city of Ahmedabad in this November 4, 2014 file photo. Any nuclear deal between Iran and six world powers loosening sanctions against Tehran could flood an oversupplied oil market with more fuel, yet sectors like cement and steel would see a rise in demand as the country works to revitalise its economy. Officials involved in ongoing negotiations said on Sunday they were close to a deal that would bring sanctions relief in exchange for curbs to Tehran's atomic programme, although no agreement was expected before July 13, 2015. REUTERS/Amit Dave/Files

ArcelorMittal SA to close 2 mills – cutting 400 jobs

ArcelorMittal SA has started discussions with unions about the closure of two mills, cutting as many as 400 jobs.

Published on:

31 Aug 2015, 12:49 pm

ArcelorMittal SA CEO Paul O'Flaherty

(Reuters) — ArcelorMittal South Africa is planning to shut two mills and is reviewing operations at its largest plant, it said on Monday, as the money-losing unit of the world's biggest steelmaker struggles with weak demand and lower prices.

SA last week raised the import tariff on steel to 10 percent, the maximum level allowed by the World Trade Organisation, to be in line with its steel-making peers. ArcelorMittal said in a statement that trading conditions have continued to worsen since it started a review of its steel business in July, adding that the higher import duty will only bring relief over the medium to long term.

The company said it had started discussions with unions about the closure of two mills — cutting as many as 400 jobs, at its plant in Vereeniging, about 60 km south of Johannesburg.

Operations at the company's largest plant, in the nearby town of Vanderbijlpark, continues to be unprofitable and will be reviewed before the end of October, the firm said: "The company will first consider implementing alternatives before retrenchments are implemented, as a last resort."

ArcelorMittal has also launched applications with SA's state-run international trade commission to impose anti-dumping duties on cheap Chinese steel.

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