ArcelorMittal South Africa To Cut 3,500 Jobs Amid Economic Struggles

ArcelorMittal South Africa, a unit of steel manufacturing company ArcelorMittal (NYSE:MT) has made a major restructuring decision to wind down its Longs Business, having significant consequences on its workforce.

Production at the Longs Business is expected to halt by the end of January 2025, and the remaining processes will wind down by the first quarter of the year.

The company stated that this move will impact approximately 3,500 direct and indirect jobs, with an even larger economic impact on the Newcastle region.

The firm cited persistent economic challenges such as high logistics and energy costs, and low-cost steel imports, particularly from China, as the main factors leading to this decision.

Despite attempts to resolve these issues through consultations with the South African government and other stakeholders, ArcelorMittal concluded that the business was no longer viable.

Also Read: Biden Blocks $14.9B US Steel Takeover

The wind-down will directly affect operations at ArcelorMittal South Africa’s Newcastle and Vereeniging Works, along with its rail and structural subsidiary, AMRAS. A formal labor consultation process will begin soon to address the concerns of employees and suppliers.

The company has also faced challenges from record Chinese exports and rising local overcapacity. China’s increasing exports have had a ripple effect on international markets, prompting urgent discussions about fair trade measures and the future of decarbonization efforts, given the financial strain.

South Africa’s steel production is expected to decline by 2.3% in 2024, compared to the previous year. Additionally, the country has seen a 50% rise in steel imports since 2018, while its exports have plunged by 40%.

Financially, ArcelorMittal South Africa expects to see a considerable decline in earnings for 2024. Revenue for the year is projected to fall by more than 5%, largely due to weak market conditions and reduced asset utilization in its Longs Business.

Price Action: MT shares are trading higher by 2.21% at $22.68 in premarket at the last check Monday.

Read Next:

Photo by QinJin on Shutterstock.

UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets.

Get the latest stock analysis from Benzinga?

This article ArcelorMittal South Africa To Cut 3,500 Jobs Amid Economic Struggles originally appeared on Benzinga.com

© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.