The beleaguered ArcelorMittal SA (AMSA), which has been battling for survival for years, has been dealt a further blow with the announcement of a “new” competitor in the market.

According to reports, SCAW Metals is going to set up a new mill for steel plates worth R5b in Johannesburg. The mill was acquired from the Italian Danieli Group, which supplies equipment and plants to the metal industry.

SCAW Metals financed two-thirds of the development and the balance was provided by a group of financiers. It is predicted that the project will replace R4b worth of imports from China annually. According to SCAW Metals, the plant will once again lead to domestic competition in steel sheets.

The market was previously dominated by AMSA which boasted plants in Vanderbijlpark, Vereeniging, and Newcastle. AMSA produces around two million tonnes of flat products annually, and the market imports around 600 000 tonnes to meet demand. SCAW Metals expects production of 300- to 500 thousand tonnes per year, which means innovation and better sustainability for the South African steel industry.