Tanzania: Local Steel Firm Expands in Tanzania

A worker cuts steel rods at a construction site. Almost all plants in Tanzania are operating at less than 22 per cent of their in-built capacity as a result of the cheap imports choking the market. PHOTO | EVANS HABIL | NMG 

By Patty Magubira

Tanzania's steel and plastics firm Lodhia Group is putting up the country's first billets plant.

According to Lodhia Group managing director Sailesh Pandit, the plant will help meet the high demand for billets in Tanzania and neighbouring countries besides helping fight off under-valued, under-declared and substandard steel imports from South Africa that have flooded the market.

Tanzania's demand for steel stands at 440,336 tonnes a year, but dumped imports alone grab the market share by 200,000 tonnes, equivalent to 45 per cent.

Billets are used in the production of iron bars, round bars, twisted bars, angle lines, hollow section, black pipes and wires.

Speaking to delegates of the 39th Ordinary Sadc Summit of Heads of State and Government, who had visited the firm's plants at Mkuranga, Mr Pandit said the new plant, whose construction is due for completion next month, will produce 150,000 tonnes of billets a year.

Going by the Steel Manufacturers Association, almost all plants in Tanzania are operating at less than 22 per cent of their in-built capacity as a result of the cheap imports choking the market.

The manufacturers of steel products have been pleading with the government to protect the industry as Kenya and Uganda did, lest they lay off workers to reduce overheads compounded by the glut.

Kenya and Uganda have imposed anti-dumping and safeguard duty of 35 per cent or $250 per tonne on coated steel imports by applying the Common External Tariff.

The two countries imported only about 9,000 tonnes and 8,000 tonnes of raw materials for corrugated iron sheets and allied products, respectively, in 2017, as opposed to Tanzania's 70,000 tonnes.

Read the original article on East African.