29 Oktober 2009
ArcelorMittal South Africa Revives Steel Projects

ArcelorMittal South Africa Ltd., the African unit of the world's largest steelmaker, said it restarted steel projects in the country as demand improved during the third quarter.

"A number of projects that were suspended in the first half of the year have been re-activated," ArcelorMittal South Africa said in a statement to the JSE stock exchange's news service in Johannesburg today.

The Vanderbijlpark-based company also boosted use of its existing capacity to 70 percent during the third quarter from 60 percent in the first half, it said.

The South African steelmaker earlier this year suspended plans to expand capacity to about 10 million metric tons a year by 2012 from 7 million tons. Spokesman Sven Lunsche couldn’t immediately say which projects have been restarted when contacted by mobile phone today.

Demand for steel declined amid a global recession, contributing to ArcelorMittal's South African unit posting a loss of 72 million-rand ($9.4 million) in the third quarter, compared with a profit of 3.75 billion rand a year earlier when steel traded at record prices.

Global prices gained about 11 percent during the third quarter, according to market researcher Steel Business Briefing's World Price Tracker index.

Results in the fourth quarter will "improve further," driven by higher sales and lower costs, the South African steelmaker said. Its Luxembourg-based parent owns 52 percent of the company, according to Bloomberg data.

ArcelorMittal South Africa fell 1.30 rand, or 1.2 percent, to 108.70 rand at 9:33 a.m. in Johannesburg, giving a market 43.6 billion rand.

(Source: SEAISI Website)

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