A serious shortage of reinforced steel (rebar) may see construction projects throughout South Africa come to a standstill, the South African Reinforced Concrete Engineers Association (Sarcea) has warned.
The shortage was caused by a breakdown at ArcelorMittal’s main furnace in Newcastle at the beginning of the year, which resulted in a six week delay in deliveries and further exacerbated by the closure of Murray & Roberts’ Cape Town Iron & Steel Works (Cisco) late last year.
“Members of the association are reporting serious shortages of rebar and mesh rod, which has been totally unforeseen and beyond their control,” said Sarcea director Rod Mountford.
ArcelorMittal spokesperson Themba Hlengani said that the “unfortunate” breakdown of the Newcastle blast furnace had lead to delays in servicing customers, but that the furnace had been restarted and was currently operating at capacity. “We are hopeful of being back to normal supply levels for domestic demand in the next two months,” he added.
The association said that project delays would result in additional costs to construction companies, while steel mills had already been notified by ArcelorMittal, which supplies about 75% of South Africa’s steel, that price increases were due this month and in March.
The industry could consider importing rebar to mitigate the possible shortage of supply, but, currently, there is a two to three month lead time and imported products are generally more expensive than locally sourced reinforcement.
Sarcea said that even if individual importers were able to source cheaper product from countries such as China, it would have to ensure that the quality of the steel complied with South African standards and specifications.
The supply problem comes at a time when government had been slow to award tenders and the construction industry had entered a major slump. Sarcea said that the supply situation only highlighted the problems that might occur when construction activity increased back to normal levels.
ArcelorMittal COO Johan Fourie said in January that there was a possibility of a future shortage of raw material, stressing that the “pressure” was on the company’s mills to improve output levels during the first quarter of the year.