Africa’s Saldanha plant
“The plans will affect 4 000 jobs in South Africa’s steel industry and seriously impact industries that depend on it,” the steelmaker said in a statement issued here. ArcelorMittal South Africa supplies about 70% of the country’s steel requirements.
Kumba “’ which provides ArcelorMittal South Africa with two- thirds of its ore needs “’ cancelled a nine-year-old supply agreement from March 1 under which the steelmaker bought ore at 3% above production costs.
Instead, Kumba proposed two options to the steelmaker: that it pay the difference between the old agreement and the market price into an escrow account until the dispute is resolved; or that it pays US$50 a metric tonne for ore supplied to its coastal Saldanha plant and US$80 a tonne for its inland plants, the miner said in a separate statement.
The dispute is currently in arbitration.
ArcelorMittal South Africa produced 8 million metric tonnes of steel in 2009, and Saldanha produces 1.2 million tonnes a year, according to the company’s website.