BSI STEEL: Overcoming Challenge and Uncertainty to Forge a Steel Icon

South Africa is one of the largest steel producers on the African continent and its steel-consuming industries contribute some R600 billion to the country’s GDP. No sector has escaped the challenges of recent times but, in spite of everything, the steel industry remains strong and resilient and a major source of employment.

A litany of factors, including the availability of cheaper imports, challenging trading conditions, high tariffs and lack of infrastructural developments have entailed reduced production. South Africa now looks to further revive the industry, restore and even perhaps eclipse its former glory with the signing and implementation of a comprehensive new master plan.

INDUSTRY MASTER PLAN

Announced by the Department of Trade, Industry and Competition in June and the product of regulators, industry and labour, the initiative covers the steel and metal fabrication sector and will reinvigorate the local steel industry, providing a massive boost to output by expanding production.

It would be hard to imagine a more wholesale transformation from the South African Journal of Industrial Engineering’s ominous forecast in 2017, which went as far as to moot the possible extinction of the entire, historically critical, iron and steel industry. Then finding itself in a truly embattled state and facing ever-mounting pressure with fewer local infrastructure projects, high input costs and global price competition, this plan looks firmly towards a lucrative and far more optimistic future.

“The signing of the Master Plan sets the foundation and commitment for the development and growth of this important sector,” the ministry said in a statement, of the plan composed in consultation with government and all stakeholders in the industry. Its principal aims include addressing demand and supply, the African Continental Free Trade Area Agreement (AfCFTA) and a steel fund to support industry projects.

Its formulation and implementation has been roundly welcomed by companies in the sector, recognising the potential it possesses to improve the long-term sustainability of an industry which employs around 200,000 workers.

“The decline in both domestic production and demand has presented a challenge to an industry which is largely in survival mode, meaning that cost-cutting – rather than investment in new technology, new plants and improved processes – is dominating the thinking of much of the industry,” the document detailed.

“The metals and engineering sector is a strategic industry for South Africa,” affirmed Steel and Engineering Industries Federation of Southern Africa president Elias Monage. “The National Development Plan is largely dependent on steel and South Africa needs steel – thus the viability and competitiveness of the sector is in all our interests.”

Some of the growth-stimulating measures which the document describes include export promotion into the African continent, which represents a significant opportunity for South African steelmakers and downstream processors. African countries purchase nearly R400 billion of iron and steel each year, and the plan will focus on opening these markets for local entities and promotion of partnerships.

Local procurement is also seen as one of the key growth drivers, with state-owned entities such as Transnet committing to review their procurement requirements and to help improve local supply chains for large-scale projects and consumables.

STEELED AND READY

BSi Steel will be one of the most important players in the southern African steel revival. South Africa’s leading steel merchant and steel supplier, BSi Steel covers the full range of mild steel forms through a primary product range spanning steel pipe, square, round and rectangular tubing, round and square bar and every conceivable iteration of pipe and coil, cold rolled coil.

Times like these are when we look to our most established leaders and this experienced industry expert has all the knowledge and capability to ride out challenges in the sector, all while ensuring clients have access to the products at the heart of their operations.

“We are a high energy, high performance company that doesn’t settle for anything less than excellence,” BSi Steel proclaims. “We keep a firm focus on our objectives and challenge ourselves to make sure we’re always on track. When results aren’t achieved as expected, we take swift action to correct performance and enable future delivery.

“We stand to remain the premium steel supplier in South Africa, and will ensure that we remain the country’s top steel merchant.”

This South African great was conceived in 1985 when William Battershill established Discount Steel, entering new markets, building relationships with new steel suppliers all the time and, as a result, growing substantially. By 1995, the company acted upon the pressing need to enter Gauteng, and so become more involved in the larger construction projects in the country’s most densely packed region.

Garrison Steel was founded and in 2001, following another strong period of growth, the group was renamed BSi Steel coupled with the purchase of a new warehouse the following year, leaving the company owning two facilities and offering strong processing and distribution capabilities.

In 2007, William Battershill and the management team listed BSi Steel on the AltX exchange in Johannesburg, raising R100m in funding which helped to fuel expansion in the form firstly of a new site in Klipriver, and then construction of a new 36,000 m² warehouse and office building. The group’s processing division, Shearcut was established and further processing lines were installed which in turn bred the confidence to continue to push for national and international expansion. Between 2009 and 2014 BSi opened new branches in Ghana and Mozambique, adding to the African presence in Zambia, the DRC and Zimbabwe.

This will not be the first time that BSi Steel has been front and centre of a monumental initiative in the country, proving itself integral to and reaping the rewards of the infrastructure boom catalysed by the 2010 World Cup. Knowing exactly when in its history to switch its focus to efficiency, wrap up inefficient operations and restructure, BSi Steel has ensured its long-term viability and stands strongly positioned to ensure low-cost, but large-scale, steel distribution all across southern Africa.

“BSi is in a very strong position today with some exciting growth prospects for the years ahead,” says BSi Steel of the green shoots it is eagerly grasping. “By working in partnership with you, we are able to help enhance your product performance, improve your efficiency and help you to create more sustainable solutions.

“The BSi Steel Group continues to expand and thrive in Africa, supported and driven by an empowered workforce that takes pride in exceeding customer expectations. At BSi Steel, everything we do is driven by our desire to build partnerships that stand the test of time.”