JOHANNESBURG – South African steel production fell by 2.7 percent year on year in September to an estimated 446‚000 tons after having recorded its first increase this year when rising by 6.9 percent in June to 545‚000 tons‚ according to the World Steel Association (worldsteel).
There was a 16.3 percent rise in South African steel production to 7.6-million tons in 2015 compared with a 2.8 percent decline in global steel production to 1.6228-billion tons. In 2015 steel production decreased in all regions except Oceania‚ which registered a 4.6 percent gain.
In the first nine months of 2016 SA steel production was down an annual 8.5 percent compared with a 11.6 percent decline for Africa and a 0.5 percent reduction for global steel production. In September global crude steel production rose by 2.0 percent annually to 132.9-million tons‚ of which China accounted for 68.2 million tons‚ which was a 3.9 percent increase.
The poor demand was in part due to the government’s multi-billion rand infrastructure investment plans failing to gain traction‚ as investment in steel-intensive railway corridors such as links to Swaziland and the Waterberg coalfields‚ remain plans‚ not projects.
The government’s economic cluster said in early September 2016 that steps had been taken to accelerate implementation of the Nine-Point Plan. The cluster was at an advanced stage in preparing for the implementation of 40 large investment projects.
In the February 24 2016 budget‚ the Treasury outlined plans for R865.4bn in public sector infrastructure spending over the next three fiscal years. The largest portion of R291.6bn would be invested in the steel-intensive transport and logistics sector.
By contrast the private sector has invested heavily in the steel-intensive nonresidential construction sector with reports of shortages of steel reinforcing bars. The real value of nonresidential buildings completed soared by an annual 31.3 percent in the eight months of 2016 as there were large increases in completions of retail‚ office and banking space in KwaZulu-Natal‚ while the centre of Sandton currently resembles one large construction site with several large buildings in the process of being erected. which should be concluded by February 2017.