Shares of ArcelorMittal South Africa (AMSA) experienced a dramatic decline of over 30% on Monday following the company's announcement regarding the closure of its long steel business.
This decision comes in response to continued losses and weak demand within the domestic market for long steel products.
The closure will affect operations at the Newcastle and Vereeniging plants, with production set to cease by the end of January.
The move is expected to impact approximately 3 500 jobs, although the exact number is still under review.
AMSA's shares plummeted to R1.09, marking a significant downturn that reflects investor concerns about the company's future viability in a challenging economic environment.
Industry analysts have pointed to government inaction as a contributing factor to AMSA's struggles, suggesting that more proactive measures could have mitigated the need for such drastic steps.
The company's decision has sparked discussions about the broader implications for the South African steel industry and the potential for job losses in a sector already under pressure.
As AMSA navigates this turbulent period, stakeholders are closely monitoring developments, particularly regarding any support or intervention from the government that may be forthcoming in light of these closures.
