The Non-Ferrous Metal Industries Association (NFMIA) reports that it fully supports the policy directive endorsed recently by Economic Development Minister Ebrahim Patel, which requires that scrap exporters seek permission to sell scrap metal offshore.
The new guidelines for scrap metal exports were issued by the International Trade Administration Commission of South Africa (Itac) on August 2.
The policy directive, which will give local industry buyers of scrap metal a preferential price of 20% below the international price, will level the playing field between South Africa and its international competitors, says NFMIA chairperson Bob Stone. This will give local industry the ability to regain its original strength and put it in a position to contribute to the upcoming demands of the National Development Plan’s infrastructure-build, localisation drive, and the drive to create jobs.
With the funding of the National Foundry Technology Network and its efforts to revitalise the foundry industry through training and technology transfer, an adequate base has been established, notes Stone. The further assistance of the new scrap export guidelines and local price preference means the foundry industry can look forward to a sustainable and competitive nonferrous metal industry, which delivers job creation and socioeconomic upliftment.
The NFMIA membership comprises several of South Africa’s major scrap metal value adding industries, including manufacturer and supplier of copper, brass and alloy-based semifinished products and busbar projects Copalcor, lead recycler Fry’s Metals, high-value aluminium semifabricated products manufacturer Hulamin, copper tubing and busbar extrusions and profiles manufacturer Maksal, extruded and processed brass alloys manufacturer Non-Ferrous Metalworks manufacturer, secondary aluminium products manu- facturer Zimalco and zinc chemicals and metals processor Zinchem. These companies are responsible for adding value to many types of South Africa’s scrap metals including copper, brass, lead, aluminium and zinc.
The government’s new infrastructure build programme will require the full support of all industry sectors including scrap collectors, scrap processors, secondary metal smelters, mini-mills, foundries, extruders and die-casters, notes Stone.
Since 2000, these industries have suffered owing to the decreasing availability of affordable and high-quality scrap metal as exports of these metals largely soared to Asia. This resulted in up to 10 000 job losses in the total foundry industry alone with the aluminium sector suffering the most, shedding up to 64% of its production capacity over the last six years.
As demand for scrap metal increases, the price increases substantially to the extent that the cost of scrap metal supplied to the South African processing industry in some cases amounts to more than 70% of total running costs. The country has lost many of its value adding industries, especially in the automotive component, pump, construction, machinery and furniture sectors, consequently lowering exports and increasing imports of these items, says Stone.
NFMIA concludes that the Depart- ment of Trade and Industry has provided comprehensive and positive input over the last ten years and the Economic Development Department and Itac have provided the new framework on which to rebuild not only the industry, but also the country.