HomeBase MetalsEmergency meeting on Kumba/ ArcelorMittal dispute

Emergency meeting on Kumba/ ArcelorMittal dispute

Trade and industry
minister Rob Davies
“’ to mediate in
iron ore dispute
Johannesburg, South Africa — MININGREVIEW.COM — 19 July 2010 – An emergency meeting is to be held today in an effort to prevent the iron-ore dispute between Kumba Iron Ore and ArcelorMittal SA (Amsa) resulting in the demise of steel production in South Africa.
This meeting has resulted from a statement by the Department of Trade and Industry that it is assessing all options to ensure the economy isn’t damaged by the dispute, and offering to mediate between the parties

On Friday the battle lines were drawn between Kumba and Amsa when Kumba put its foot down and announced that Amsa would in future have to pay market-related prices for its ore, or Kumba would stop deliveries. Amsa retorted that this step implied that agreement might never be reached, causing Saldanha Steel to close its doors and put some 4 000 people out of work.

Miningmx reports that on Friday afternoon, trade & industry minister, Rob Davies, intervened and asked the companies’ chief executives to meet him today in an effort to reach an agreement. The dispute could not be allowed to reach point where domestic production of steel became disrupted, he declared.

Earlier, Kumba had announced that from 1 August it would not deliver iron ore to Amsa if Amsa did not pay in advance. Amsa would also have to settle its account with Kumba, which had escalated since the dispute arose in March.

Kumba is now demanding US$50/tonne for iron ore delivered to the Saldanha plant, and US$80/tonne for ore delivered to its inland plants at Vanderbijlpark and Newcastle.

CEOs Chris Griffith of Kumba and Nonkululeko Nyembezi-Heita of Amsa “’ as well as financial directors Vincent Uren of Kumba and Kobus Verster of Amsa “’ have had several meetings in recent weeks in an effort to reach an interim agreement on supplying iron ore to Amsa.

Kumba says it has made several proposals, but Amsa’s representatives have failed to react to any.