Patel to reopen Cape Town Iron and Steel Works plant

Economic Development Minister Ebrahim Patel will on Wednesday officially reopen the Cape Town Iron and Steel Works plant (Cisco), in Kuils River, in the Western Cape.

Established in 1967, the factory was closed in 2010 and put under care and maintenance by its previous owner, construction and engineering services provider Murray & Roberts, with a loss of about 360 jobs.

The re-establishment of the factory is expected to return substantially all of these jobs in the coming years.

The new Turkish owners of the factory, DHT Holding, has invested R550-million since acquiring Cisco, in 2012, to expand and upgrade the steel plant, which uses electric arc furnaces to produce steel from scrap.

The investment represents one of the largest investments by a Turkish firm in South Africa.

Cisco’s products are typically used in the manufacturing and construction industries and are sold domestically, as well as exported to the rest of Southern Africa and other international regions.

At full production, Cisco expects to source 500 000 t/y of scrap metal and limiting scrap exports plays a key role in ensuring that businesses such as Cisco remain sustainable.

Local foundries and steel mini-mills have been under pressure for years, owing to the unavailability of scrap metal – a vital feedstock – owing to a surge in the export of scrap metal.

The reopening of the Cisco factory follows the introduction of a trade directive issued by Patel, which provides local steel mills with greater access to scrap metal, through a price preference system that favours local industry.

This also supports jobs, the national infrastructure programme and South Africa’s climate change commitments.