ArcelorMittal SA says Transnet Freight Rail missed 40 of delivery targets in 2024, forcing production cuts and delays that triggered steep operational losses.
Rising tariffs and unreliable logistics, combined with Eskom outages, are undermining ArcelorMittal SAs financial sustainability and supply chain efficiency.
Two plants have closed, thousands of jobs are at risk, and the company warns it may liquidate long steel operations without urgent logistics and import reforms.
ArcelorMittal South Africa ArcelorMittal SA, the Gauteng-based steelmaker linked to businesswoman Noluthando Gosa, has escalated its legal battle with Transnet, accusing the state-owned logistics giant of anti-competitive conduct that threatens its survival.
The company has lodged a complaint with the Competition Tribunal, alleging that Transnet Freight Rail TFR has exploited its monopoly over bulk rail services. According to the filing, TFR has persistently missed delivery targets while sharply raising tariffs, undermining ArcelorMittal SAs operations. Although the Competition Commission earlier dismissed the complaint, the company has opted for a self-referral to trigger a full tribunal hearing.
Delivery failures and soaring costsTransnet confirmed it will oppose the self-referral and has already submitted papers to the tribunal. ArcelorMittal SA argues that TFRs failures are jeopardizing its survival. Its 2024 annual report shows TFR missed over 40 percent of delivery targets last year, disrupting iron ore shipments essential to production. Over the same period, rail tariffs rose faster than inflation for three consecutive years, compounding losses.
These logistics setbacks, coupled with Eskoms unreliable power supply and escalating transport costs, have further weakened the companys competitiveness. ArcelorMittal SA said the rail inefficiencies forced it to scale back production, delay customer deliveries, and absorb hundreds of millions of rand in unplanned expenses.
Mounting losses and plant closuresThe crisis has already triggered significant retrenchments. In 2024, the company shuttered its Newcastle and Vereeniging plants after failing to secure rescue agreements with government stakeholders.