Lovemore Zigara, Midlands Correspondent
REDCLIFF-based steel manufacturer Steelmakers has increased its exports into the region spurred by the export incentive that was introduced by the Reserve Bank of Zimbabwe last year.
The local foundry manufactures close to 36 000 tonnes of steel per annum, which is converted to various shapes to cater for the engineering, agriculture, motoring, mining, construction and manufacturing industries.
The export incentive was introduced by the central bank under a $200 million bond notes facility guaranteed by the African Export-Import Bank.
Under the arrangement qualifying exporters get an extra five percent in bond notes.
Steelmakers operations director Mr Upendra Alamwar told Business Chronicle the company was exporting at least 30 percent of its total production into the region with Zambia and Malawi being the major consumers of the company’s products.
“There have been positives, which can mainly be attributed to the export incentive that was introduced by the Reserve Bank (of Zimbabwe). As a company our product has a ready market in the Sadc region and we are capitalising on the incentive scheme to export our product to Malawi and Zambia among other countries,” he said.
The Steelmakers’ boss said the momentum brought about by the export incentive was being complemented by firming international steel prices, which plummeted four years ago and negatively impacted on the global steel industry.
“We are positive in our forecast as the global price of steel is going up because four years ago the price of steel hit rock bottom. This affected our viability because our costs are fixed in United States dollars because of the nature of our economy,” said Mr Alamwar.
“This was in sharp contrast with our neighbours who had weaker currencies and we could therefore not compete with them. We are happy that the South African rand is firming and with steel prices picking up we will be able to compete.”
Steelmakers is operating at 25 percent capacity owing to foreign currency shortages and the shortage of scrap metal among other challenges.
It employs more than 500 workers.