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Mittal vs The Downstream; steel industry war

The downstream Steel Industry, under siege for decades, is facing its next huge crisis. For many years, ArcelorMittal South Africa (AMSA), South Africa's dominant liquid steel producer, found the South African steel market to be a favourable playing field. For a long time they could keep their input costs low as a result of a preferential supply agreement for iron ore. However, whilst having this lucrative iron ore deal, AMSA charged the South African downstream industry similar prices to what they (AMSA) obtained on international markets. The downstream industry paid high prices for their steel, whilst AMSA made huge profits.

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Sacrificing the steel industry to save Mittal

The Steel Industry is in troubled waters. There are many indicators to this effect, but job losses is an important one. According to the MEIBC, the Steel Industry has lost 150,000 jobs over the last ten years, of which 40 000 jobs were lost in 2015 and 9,000 in the month of November 2015 alone. The MEIBC is predicting a further 30 000 job losses in the Steel Industry this year.

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