The functions of an engineer can be encapsulated in one sentence: the promotion of the wellbeing of people. Hendrik van der Bijl, South Africa’s remarkable industrialist, made this statement to the Scientific and Technical Societies of South Africa in 1926. To be fair, though, the same function should apply to other legitimate professions.
But Van der Bijl’s remarks, speaking for himself as an engineer, are as profound today as they were back then. His beliefs had driven him to establish the Electricity Supply Commission (Eskom), and later the Iron and Steel Corporation (Iscor). The two companies would become major catalysts of South Africa’s large-scale industrialisation.
When South African politicians speak, as they did during the 2024 election campaign, about the importance of beneficiating our minerals instead of exporting raw ores, they may be unaware they are reasserting the great Van der Bijl’s beliefs. Promoting wellbeing in the current South African context means building an economy that improves the standard of living by, among other things, creating jobs and business opportunities.
In 1929, he told the Royal Society of the Arts in London that South Africa’s industrialisation could not rely only on primary mining and agriculture. Instead, the country’s industrial foundation could be made of steel. He said this, having already set up Eskom to provide reliable and cheap power to industry. Steel held literal and figurative significance for a solid foundation.
Acting on his belief, Van der Bijl combined his entrepreneurial flair, his technical capabilities and government collaboration with abundant natural resource endowment — coal, manganese and iron ore — to propel South Africa to an industrial future. Other entrepreneurs had experimented with power generation and steel production at small scale before him. But none had his national vision. His story, told by historians like Alice Jacobs, makes for a wonderful introduction to South Africa’s modern economy.
After its establishment in 1927, Iscor started producing steel in Pretoria in the early 1930s. Steel manufacturing was also established in Vereeniging in what became known as Vanderbijlpark, an industrial area he conceived and planned, in 1939. He founded African Metals Corporation, an Iscor subsidiary, in 1937 to make semi-processed products in iron and steel.
In 1953, five years after his death, Metalloys was established in Meyerton, kick-starting operations with two furnaces transferred from Iscor’s site in Vereeniging. The Metalloys complex sourced its manganese ore mostly from SA Manganese, a mining company that owned rich deposits of the mineral in the Northern Cape.
SA Manganese and Amcor enjoyed a lasting partnership, culminating in a merger in 1975. The merged entity was aptly named Samancor. Over the years, various corporate activities led to Samancor Manganese — owned by mining companies South32 and Anglo American — being the operator of Metalloys at Meyerton’s historic industrial complex 50km south of Johannesburg.
The once-formidable parent company Iscor — renamed ArcelorMittal after privatisation and corporate mergers — was unbundled, with its iron and coal interests spun off. Cheap imported steel, logistics inefficiencies, restrictions on the scrap metal trade, electricity supply challenges and volatile labour relations have affected ArcelorMittal’s output.
It remains the largest producer in Africa, making 2.8Mt of liquid steel in 2023. But with its steel plants in Saldanha and the Vaal having been under care and maintenance for a while, the company is not performing to its maximum capacity. It had even considered closing its Newcastle plant in KwaZulu-Natal, home to one of the country’s oldest industrial sites, but announced on July 2 that operations would continue.
The fact that these enterprises — Iscor (ArcelorMittal), Metalloys and Highveld — once advanced a modern economy makes their decline unsettling for anyone who wants to see South Africa succeed
After years of continuous production of manganese alloys, 90% of which were used in steel making, Samancor Manganese’s Metalloys operations came to a halt in 2020 following a review. Having previously sustained 700 jobs, the operation has been on care and maintenance. Market conditions, electricity prices and logistics challenges must have weighed heavily on the business.
The combined decline of ArcelorMittal and the halting of production at Metalloys symbolised South Africa’s painful deindustrialisation. Adding to this is the painful fall of the once-innovative steel maker and vanadium processor, Highveld Steel and Vanadium Corporation. Established in the 1960s by Anglo American as its first investment outside mining, Highveld was described by Harry Oppenheimer as a “major single act of faith by a private enterprise in the future of South Africa”. Anglo American shut it down in 2007. Its acquirer, Evraz, went into business rescue, a tragic opposite of Oppenheimer’s “act of faith”.
The fact that these enterprises — Iscor (ArcelorMittal), Metalloys and Highveld — once advanced a modern economy makes their decline unsettling for anyone who wants to see South Africa succeed.
If the decline of ArcelorMittal, the mothballing of Metalloys and the fall of Highveld symbolised South Africa’s industrial decline, their revival should mean the opposite. Their revival, through renewed acts of faith in the country by private investors, could lead to the rebooting of hope for the improvement of the wellbeing of the country’s citizens.
South Africa is punching well below its weight on the production of manganese alloys, steel and iron. Although we produce one-third of global manganese ore and boast the largest reserves located in the Northern Cape, we represent only about 5% of global manganese alloys production.
The same can be said about iron ore. South Africa produces quality iron ore, but World Steel Association numbers show that at about 4.8Mt of crude steel per annum, we make less than 1% of the global share. The revitalisation of steel manufacturing and associated industries is crucial for South Africa’s re-industrialisation.
Believing in the country’s industrial prospects has propelled us to invest in the Metalloys business. Although the context is different compared to the days when Van der Bijl set the scene with his remarkable industrial acumen, the required ingredients to revive the business haven’t changed. A reliable supply of power, quality manganese ore and an efficient logistics network are still the key ingredients.
With industrial infrastructure in place to support revival of the Metalloys smelter complex, what is required is investment in innovation and modernisation. Sound investment decisions backed by sound engineering will most likely produce the desired outcome of industrial revival.
It is the case now, as it was during Van der Bijl’s time, that South Africa’s industrial foundation and the wellbeing of its people depend on the manufacture of various steel and associated products, the ingredients of which include manganese alloys. Infrastructure development, which many governments use as a tool to rejuvenate their economies, makes it necessary to develop and modernise manufacturing of this kind — and to remain competitive.
• Bayoglu is the MD of Menar, a co-investor in Khwelamet, which has signed a binding agreement to acquire Samancor’s Metalloys manganese smelter in Meyerton.
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