Novolipetsk Steel (NLMK) which is among Russia’s one of the four largest steel companies has recently announced the opening of a new service centre in South Africa under the name NLMK South Africa. The service centre will supply abrasion-resistant and high-strength thick plates produced at the Belgian NLMK Clabecq. NLMK South Africa will also make parts of these steels as per customers’ requirements.
The centre is favourably located not too far from the Johannesburg city. Its key clients will include mining, machine building, construction and other companies, not only in South Africa but also in Namibia, Botswana, Zimbabwe, Mozambique, Angola, Zambia, among others.
The company’s management has quoted that Africa is considered to be one of the fastest growing and the most prospective markets. The company’s plans in the African market include the sale of high-strength and abrasion-resistant steels, with additional plan to include construction steel, steel for high-pressure vessels, tool steels, and other products.
NLMK which is headquartered in Lipetsk, Russia has a percentage share of 25% in Russia’s total steel production. It primarily produces flat steel products, semi-finished steel products and electrical steels. NLMK also produces speciality coated steels, plus high-ductility and micro-alloyed steels. The company operates production facilities in Russia, Europe and the United States and its steel production capacity exceeds 17 MnT per year.
NLMK’s consolidated finished steel sales fell -3% on-year in the first half of 2018 to 5.24 MnT, but semi-finished product shipments surged 32% to 3.29 MnT.
Increased interest towards African market
After the U.S. government announcement of tariffs on steel and aluminium imports, and with south-east Asian markets getting crowded, producers in steel giant China has also started exploring African markets to supply their steel output.
According to China’s customs data, country’s steel exports to Nigeria, Africa’s biggest economy and the continent’s top buyer of Chinese steel, rose 15% in the first quarter, and shipments to Algeria, the fourth-largest economy, nearly tripled.
Compared to Asia, there are fewer nations in Africa with anti-dumping duties and safeguard measures against Chinese steel products.
ArcelorMittal South Africa, which supplies nearly all of its steel output to African markets has also confirmed the increased influx of Chinese steel in the African market.
Out of Russia’s total steel exports in 2017, Algeria has a percentage share of 3%. NLMK’s new service centre in Africa and increased Chinese interest in the continent backs that Africa is an upcoming export destination for major steel-producing nations.
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