June 2011

profile

Air Products
giants
of
gas
Taking service and supply to the next level

PLUS

Industry

analysis

The state of the global stainless steel sector

Association

Review

Sassda to become more member driven

R29.95

June 2011

CONTENTS

REGULARS

3
22
24
30
32

Perspective

A message from Sassdas executive director Sethakgi Kgomo

Welding Q and A

Welding expert Damian Kotecki answers your welding questions

Industry News

Sassda News

Personality Profile

News and events from companies in the industry

News and events from the association
We talk to Sassdas chairman Bernard Maguire

PROFILES

Fabrinox

Air Products

Falcon

June 2011

Awarding service excellence

Stalcor

Industry bids farewell to Colin West

Indian surplus

A drop in consumption of Indian stainless steel

may push the country into a surplus

After a challenging year, Sassda has implemented

numerous measures to turn the association around

Artisan training centre launched

Obituary

The cost of nickel and ferrochrome is affecting the

production of stainless steel globally

Gas giant tackles new strategy

Industry trends

Rebranding takes company to a new level

Association overview

10

Air Products
Bohler Uddehold
Boltfast
Columbus Stainless
Euro Steel
Fabrinox
General Profiling
HiTech Stainless
Macsteel VRN
Rimex Metals Group
Stalcor
Steelbank Stainless

ADVERTS

13
14
18
20
21

FOCUS ON

June 2011

PERSPECTIVE
Industry leaders in the manufacture of aesthetic
and functional steel sheet products, forging a
glittering track record including iconic buildings and
projects throughout the globe.

CONTACT US
Publisher
Editor


Sales

Photographs




Printers

Maverick Marketing
Melissa Rowlston
Tel: 011 483 0941
melissa@stainlesssteelmagazine.co.za
Hermy Ballinger
hermy@stainlesssteelmagazine.co.za
Marc Rowlston
marc@pulpfilms.co.za
Shutterstock
Goldfields Press
Tel: 011 627 7740
Fax: 011 627 7741

Letters, comments and subscription

requests to melissa@stainlesssteelmagazine.co.za

SASSDA
Executive Director
Sethakgi J Kgomo
Marketing & Communications Yumna Emeran

011) 793 3695/8

E-mail projects@rimexsa.co.za

www.rimexsa.co.za / www.rimexmetals.com

Tel: 011 793

3695/8 projects@rimexsa.co.za
E-mail:
projects@rimexsa.co.za
www.rimexsa.co.za
/ www.rimexmetals.com
011) 793 3695/8
E-mail

Tel: 011 883 0119

Fax: 011 883 0183
e-mail: info@sassda.co.za
www.sassda.co.za
Stainless Steel is published quarterly and is distributed to
stockists, distributors, fabricators, specifiers, consulting engineers,
architects, mining, petrochemical and chemical industries, food
beverage and pharmaceutical industries, consumer outlets,
end-users, educational institutes and provincial and government
departments. Maverick Marketing makes every effort to ensure
the accuracy of the contents of its publications, but no warranty
is made as to such accuracy, and no responsibility will be borne
by the publisher or Sassda for the consequences of any actions
based on information so published.
All opinions, views and expressions contained in this publication
are not necessarily those of the management of Sassda.
The contents of this publication enjoy positive protection under
the Copyright Act and therefore copyright thereof is expressly
reserved. Any copying,publication and distribution of part or
whole of the publication is prohibited unless consent is granted
by Sassda.

Tel (011) 793 3695/8

June 2011

or Sassda, 2011 is the year in

which is takes its membership focus forward.
The Strategic Plan, which was
adopted by the Board, was informed
by industry conditions, the membership
needs and the financial resources.
In this spirit of revitalisation,
Sassda revisited and refined its Purpose Statement to ensure clarity of its
focus:
To provide a platform for Sassda members to collectively promote
the sustainable growth and development of the industry with the main
emphasis on stainless steel converted
within the South African economy.
In promotion of the membership-driven objective, we have developed a key customer value matrix which allows Sassda to focus on
those aspects which our members feel are important to them.
While there is still groundwork to be done in activating some
of these, the majority of the projects are already underway. Lobbying
on behalf of the sector is in full swing and Sassda will report on the
outcomes of these high-level interactions.
Notably Sassdas BEE status is revised to a Level 3, which we
know assists our members in their tender procurement efforts.
Additionally our Stainless Steel Magazine has really bedded
itself down and the feedback we received from members and nonmembers indicate strong support for the magazine.
This industry mouthpiece therefore remains an important tool
for our members.
We welcome our new members to the Sassda fold and as we
move along the path to ensuring that the Sassda objectives are fulfilled,
our members will see a highly active association.
Best wishes for a further productive six months in 2011.




Sethakgi J Kgomo
Sassda Executive Director

E-mail projects@rimexsa.co.za

focus on

The cost of nickel and ferochrome, as well as the production of these metals,
significantly affects the Stainless Steel Market, which analysts believe is
weathering all other factors to regain its footing on the global stage

Industry Trends

ISSF optimistic on
stainless steel production

Pascal Payet-Gaspard, the secretary

general of the International Stainless
Steel Forum (ISSF), said at its annual
conference in May that European stainless steel production has kept on rising
and that the ISSF expected it to be back
to pre-crisis levels by 2013. However,
he was optimistic that it might happen
as soon as late 2011 or early 2012.
According to statistics, global
stainless steel crude production increased to 8.4 million tons in the first
quarter of 2011, an 8.2% increase
quarter-on-quarter and an 8.6% rise
year-on-year.
The ISSF believes that this growth
rate might not continue over the rest of
2011. However, it expects global production as a whole for 2011 will increase to a record high.
Sources quoted by SteelGuru say
globally the stainless steel market has
improved. It has grown by between 5%
and 6% and this year for the first time
global stainless steel production has exceeded 30 million tons.
However, UK based MEPS said
in early June that the long awaited pickup in stainless steel purchasing activity
had not materialised. On the contrary,
the expected seasonal summer lull in
consumption appears to have arrived
early in many parts of the world.
Even in regions where the spring
traditionally heralds an upturn, led by
the construction industry, demand from
manufacturing and other applications
has dropped off. In some countries,
consumption by the building sector has
been disappointing and this has led to
overstocking by distributors.

A ray of light is expected in the stainless steel industry as production slowly resumes

Nickel
Nickel has fallen sharply on the
benchmark London Metals Exchange
(LME) since March and, like most
commodities, dropped sharply at the
June 2011

Global Apparent Supply vs Real Demand for Stainless Steel

EuroAfrica, Americas, Asia, China

140

Real Demand forecast

Real Demand

Index 2005 = 100

120
100
80
Apparent Supply
stock increase
stock decrease

60
40

stock neutral

20
0

2005

2006

2007

beginning of May. This was due to speculation on the commodity markets and had
little to do with the fundamentals of either
nickel or stainless steel.
The spot price of nickel is currently
around $23 000 a ton. These prices are
considerably higher than levels seen in
January and February. The LME reported
that nickel prices for the three months delivery dropped to $22 395 a ton on May
23, after breaking through the $25 00
a ton mark on May 4. Nickel peaked at
$51 800 in 2007.
The supply of nickel has been in
deficit so far this year but this has been
absorbed by a reduction in both LME
stocks and Chinese inventories. However, production is forecast to outstrip
demand in the second half of 2011. It
is, therefore, likely that nickel prices will
be lower, on average, in the remainder
of the year.
This considerable fall of LME
nickel price has shaken the price of
nickel-based stainless steel scrap in most
countries.
Duncan Hobbs, an analyst at
Macquarie, believes that: Nickel supply

2008

2009

2010

2011

Source: ISSF updated October 2010

will go from a deficit last year and in the

first part of this year to a surplus in the
second half of this year and in 2012 and
2013.
As a consequence, Macquarie
expects nickel prices to fall to an average of $21 000 a ton next year and
$19 300 in 2013.
Vanessa Davidson, of CRU
Group, also expected the nickel market
to record surpluses in 2012 and 2013,
but at 40 000 tons and 20 000 tons,
respectively, they would not be huge.
While demand from the stainless steel
sector will remain sluggish for a few
months, many see it picking up from
around September after the seasonally
quieter northern hemisphere summer.
Reuters reported that a plethora
of nickel projects starting up in the next
two years will not cause huge supply
surpluses, as some schemes will take
time to ramp up and demand will grow,
so the metals prices are not about to
drop much.
Sellers had started lowering offer prices for various types of stainless
steel at the end of May after nickel fell
5

focus on

invest in developing these commodities, despite many of the worlds mineral resources continuing to be bought
up by the mining giants Rio Tinto, BHP
Billiton and Anglo American. These
four majors will, by 2015, own 64%
of the worlds five largest iron ore projects with annual output of 500 million
tons per year and 73% of the nickel
markets five largest mines at 237 000
tons per year.
Davis said that the company
remains confident about the medium
to long term fundamentals of our industry, although the mining industry
faces emerging challenges in the form
of windfall taxes, royalties as well as
higher input costs, growing legislation
and environmental concerns.

Industry Trends

A smelter at Eramet, the worlds largest ferronickel plant

below $23 000 a ton, but most buyers, other than those with urgent need
for materials, are not enticed. However, nickel prices rebounded to above
$23 000 a ton and stainless prices are
steadier now.
Views are divided on whether
Asian stainless prices have bottomed.
While some note that current stainless
prices are already near cost levels, if
not already loss-making for some, others
reckon sluggish demand will force stainless prices lower.
Analysts say while new nickel
production is coming on stream involving laterite nickel ores to be processed
with new acid-leaching technology; it
wont all be coming into play at once.
They dont see the laterite nickel ores
(meaning ore located close to the surface) having much impact on world
nickel supply and demand.
One aspect of the world nickel
market, Chinas expansion and refinement using nickel pig iron for internal
consumption, has analysts concerned
about what could happen to the world
nickel market as a whole.
While Chinese producers of
nickel pig iron, a nickel substitute, had
a production cost equivalent to nickel
when they started several years ago,
6

Nickel Facts

LME Cash Buyer Nickel Price - April to June 2011

28 000
27 000

January to March 2011:

The global supply of nickel 26 000
had a shortage of approxi- 25 000
mately 11400 tons.
24 000
April to June 2011:
23 000
Nickel shortage continued
with approximately 50 000 22 000
1 June 2011
1 April 2011
1 May 2011
tons in short supply.
July to December 2011:
New nickel projects are scheduled to commence, with nickel production and
the global supply of nickel expected to turn to a surplus. Accordingly, an
international balance on supply and demand of nickel in 2012 to 2013 is
anticipated to have a substantial excess.
efficiencies introduced since then may
have cut costs by about half.
Jean-Charles Cachon, a commerce and administration professor at
Laurentian University, agreed that world
nickel prices wont move much in the
year ahead.
He said that after nickel hit record
highs in July 2007, one of the worlds
biggest nickel consumers, China, took
such measures as stockpiling nickel and
getting into nickel pig iron to ensure
its growing economy would never get
burned again by rampant speculation.

Nickel pig iron is now 20% of

world demand, he said, noting that
product is primarily for internal Chinese
consumption.
The growing populations of nations such as India and China are having a multiplier effect on commodity demand, with iron ore and nickel being
among those metals to benefit from this
structural shift in commodity demand,
Xstrata chief executive Mick Davis said
in recent presentation obtained by Steel
Business Briefing.
Xstrata said it would continue to
June 2011

Ferrochrome
Bloomberg reported in June
that Merafe Resources has agreed to
join Xstrata in a project to expand the
worlds biggest producer of ferrochrome
and will fund its R1 billion contribution
with cash, debt and future revenue.
The companies will construct a
360 000 ton smelter, raising annual ferrochrome capacity of their joint venture
in northern South Africa to 2.3 million
tons, Johannesburg-based Merafe said
in a statement. The company owns
20.5 percent of the Xstrata-Merafe
Chrome Venture, supplier of about a
fifth of world demand for ferrochrome,
used to make stainless steel.
Merafes share price rose 0.8%
on the news in Johannesburg to R1.23,
it has fallen 26 percent in 2011 as
costs have risen and demand for stainless steel remains subdued.
Merafe said production from the
new smelter was scheduled to begin in
the first half of 2013, by which time the
market is expected to be short of supply.
European Consolidation
In the wake of stainless steel
industry consolidation across Europe;
with Arcelor Mittal hiving off its stainless steel business into newly formed
Aperam and its proposed merger with
companies such as Acerinox, ThyssenKrupp is following suite.
After a failed attempt in 2009,
ThyssenKrupp announced in May it was
looking to separate from its stainless steel
division, adding to speculation that Europes stainless steel industry could soon
see consolidation. The regions industry
is suffering from some 1.5 million to 2.5
million tons per year of excess stainless
June 2011

Pig iron smelters offer

an alternative to nickel

Chinese bank on pig iron for stainless manufacture

Chinas growing hunger for nickel
pig iron saw its stainless steel makers
use 78% more of the high iron content raw material in 2010 than the
year earlier, in a trend that dampens
nickel prices by swelling a global
supply glut.
Macquarie Bank analysts say
it is much cheaper to use nickel pig
iron over primary nickel.
Nickel pig iron is a form of
lower grade ferronickel made from
laterite nickel ore that can be used
as an alternative to making stainless steel from nickel refined from
sulphide ore. Nickel pig iron can be
costlier to use when primary nickel
prices are low because pig irons
low nickel content means more of
the metal must be added to the steel
making mix. It also requires lots of
energy, so production is only worthwhile when nickel prices are high. It
typically sells at a discount of 15% to
LME traded nickel because suppliers
do not get paid for the iron content.
Industry data shows that nickel
pig iron is also cheaper than its closest alternative, scrap nickel, which
attracts a discount of just 8% to LME
nickel. Steel production from nickel
pig iron tends to progressively kick
in when primary nickel prices pass
$18 000 a ton.
slab capacity out of a total capacity of
8 million tons per year, according to different estimates.
The ThyssenKrupp stainless divi-

Commodities researcher CRU

counts 88 steel mills in China capable of using nickel pig iron to make
stainless steel and a combined capacity to consume 600 000 tons a
year, nearly half of total world nickel
consumption. Only a fraction of this
volume has so far been unleashed
on the market, because most mills
returned to cheap primary nickel during the global financial crisis.
Gerhard Pariser steel analyst
of Heinz H Pariser Alloy Metals&Steel
Market Research says that Chinese
stainless steel output grew 15.5% in
2010 over 2009 and is forecast to
rise another 6.7% in 2011. He added that China is the new stainless
steel superpower.
But Chinese analysts believe
that the countrys real nickel consumption growth will slow to between
2% and 4% in 2011, from 12% in
2010, as demand from an oversupplied stainless steel sector slows.
For now, nickel pig iron satisfies about 10% of the total global
appetite for nickel, but holds a whopping third of the prized Chinese
market. More importantly, Chinas
demand for nickel for use in stainless
steel is forecast to grow an average
of 9% a year and nickel pig iron is
expected to fill the gap.
sion is expected to be listed separately
on the stock market, putting it in the
same position as Europes other major
flat stainless producers.
7

focus on

Industry Trends

Surplus output hits

Indian stainless steel industry

Indias stainless steel industry may have
1.3 million tons of surplus output by the
end of next year following massive capacity additions by domestic producers.
According to the president of the
apex trade body, Indian Stainless Steel
Development Authority (ISSDA), total
production is estimated to surpass 4 million tons by the end of 2012 against the
anticipated consumption of 2.6 million
to 2.7 million tons. Consumption, however, is expected to decline further, due
to the slowdown in infrastructure development. The surplus may widen even
further in case demand does not recover
soon, he said.
Indias current per capita consumption of stainless steel is 1.2kg. The
industry target is to double consumption
levels in the next two-three years.
While Jindal Stainless is currently
doubling its capacity at Hisar to 1.5
million tons, its 800 000 ton plant in
Orissa is set to commence operation by
August.
Other major producers including
Salem Steel Plant, controlled by Steel
Authority of India, Panchmahal Steel,
Viraj Steel and Mukand Ltd among others, have envisaged massive expansion
to add 0.5 million tons of accumulated
capacity by the end of 2012.
The development surrounding
Chinese imports of kitchenware, though
of a small quantity, has the Indian industry worried because the Chinese products are between 20 and 25 percent
cheaper than the same quality domestic
product.
The reason, industry experts say,
is because China has better access to
nickel pig iron. India does not have access to the technology developed for
producing nickel pig iron.
Indian kitchenware manufacturers
fear more imports from China may affect
the growth of the Indian stainless steel industry. The utensils sector uses nearly 65
percent of stainless steel produced in the
8

country. The biggest worry for Indian

utensil manufacturers is that China has a
surplus capacity of 2.5 million tons and
is bound to dump it in Indian markets,
said Mathur.
Following extensive volatility in
nickel prices, Indias 10 000 stainless
steel utensil manufacturers are thinking
of producing magnetic grade induction
cooking medium to avoid dependence
on the imported ingredient. The induction cooking medium is magnetic but is

nickel free. Hence, utensil manufacturers

can price the final product without bothering about the uncertainty in prices.
After hitting a high of $54 000
a ton on the London Metal Exchange
in 2007, nickel prices slumped to
$13 000 a ton early last year, recovering again to trade currently at $23 300
a ton.
Published with permission from Business
Standard. www.business-standard.com
June 2011

association

update

Sassda to focus

on supporting its members

The Southern Africa Stainless Steel Development Association (Sassda) has faced a
challenging year. Sassdas executive director, Sethakgi J Kgomo, has been at the
helm for over seven months and during
this time he has made a full assessment of
the organisation and instituted significant
changes. Negative trading conditions
have started to lift over the stainless steel
industry and South African manufacturing
in general; however, the industry remains
in a challenging position.
Sassda board chairman, Bernard
Maguire, says that the industry employs
about 18 000 people, contributes to
the balance of payments through the
export of 80% of its local stainless steel
products and imports 34% of primary
product for its contribution to local conversion. Sassda is therefore committed
to its strategic growth strategy, which
supports the governments initiatives to
boost domestic growth while building
export markets.
The economic climate has continued to place pressure on Sassdas funding. The funding structure compels the association to ensure that it focuses on what
it can deliver with its limited resources.
Kgomo says: This funding structure is
not likely to change in the near future, but
Sassda is well positioned to dig its heels
in and become a truly member-driven
organisation. Sassda has indeed shifted gears and increased its delivery during the past seven months.
Kgomo has taken it upon himself
to rectify the ineffectual practices within
Sassda and to turn the association back
into a member-driven body. Kgomo
has put in place a three-year strategic
plan that has duly allowed Sassda to
revisit its purpose statement. Sassdas
purpose is to provide a platform for Sassda members to collectively promote the
sustainable growth and development of
the industry with the main emphasis on
stainless steel converted within the South
African economy.
10

Executive director Sethakgi J Kgomo has made significant changes to Sassda in the seven months he has
been at the helm of the stainless steel industry body

Local manufacturing remains a key principle for Sassda and the

association is focussing on members
June 2011

Sassdas turnover for the year

was down, due to the global economic
impact on the stainless steel industry.
However, marginal turn-around from
loss-making to some profit was attributed
to active cost containment and strong
management controls. Sassdas financial
position indicates a relatively healthy financial position.
Sassda has budgeted for breakeven as per instruction of the board,
which was a very conservative approach. For March/April, the domestic
levy is up from the budget.
Sassdas three-year strategic
plan has been approved by the board
and aims to facilitate the aggregate
growth of stainless steel tonnage. It will
re-position Sassda as a member-driven
organisation, adding real value to its
members.
Sassdas new slogan is: South
Africa First. The strategy aims to deJune 2011

sign high level interaction to remove

existing trade, operational and labour
relation barriers. It also plans to facilitate sustainable employment and skills
development growth.
As outlined in its strategic objectives, Sassda has committed to promote
localisation of the industrys value chain,
by supporting local conversion and consumption of stainless steel, and the creation of sustainable employment.
The association plans to improve
communication between itself and its
membership and critical stakeholders.
It will also work to increase its national
and global profile and mobilise the stainless steel sectors.
Kgomo is determined to inculcate
a performance-driven culture in Sassda
and re-engineer and sustain positive
financial management and effective controls in the organisation.
It is necessary to note that while

the association has no control over sales

of stainless steel, it is committed to playing a facilitation role.
Taking the membership focus a
step further, Sassda has developed a
matrix of key customer values within stainless steel. These values allow Sassda to
focus on market specific needs. It ensures
positioning of stainless steel favourably
within these customer values.
Furthermore, a member-driven
approach to the actual product deliveries of Sassda was initiated. The
services within these Sassda offerings
for members include: Business Development; Industry Monitoring; Lobbying;
Skills Development; Research; Networking Platforms; Marketing and Public
Relations. Sassda says that while this is
not an exhaustive list, it does represent a
large portion of the actual activities that
the association undertakes on behalf of
the industry and its members.
11

company

association

update

Profile

Apparent Consumption 2011 with forecast

(2010 below)

Sassda will continue to monitor

South Africas consumption and this
year we have seen a 40% increase in
the apparent consumption of stainless
steel in the past year. There was an
increase of 33% in the local conversion
of stainless steel and an increase of
35% of imported finished product.
Sassda remains optimistic that
these increases will continue in the coming year, and the association says it will
ensure that it adds its efforts to the increased consumption of stainless steel.
Sassda has seen a marginal
decrease in member numbers. This is
mainly due to non-payment of membership fees as a result of the economic
climate.
The past seven months have seen
a major operational restructuring at
Sassda. Kgomo has made the following
changes:
Corporate Governance structures
are continuously being strengthened
within the Association;
Sassdas BEE Status has been re-

Primary Local Supply

122 231 tons
(91 653 tons)

Fabrinox ensures

Local Converting
164 101 tons
(116 972 tons)

Primary Imports
41 870 tons
(25 319 tons)

service quality

Finished Product Imports

13 141 tons
(9 757 tons)

Apparent Consumption
177 242 tons
(126 729 tons)
vised to a Level Three Contributor;
The Article of Association is
being amended to fall in line with New
Companies Act 2008;
Kgomo has instituted a Performance Management System to support
Sassdas Performance Driven Culture;
Notably the Delegation of Authority has been implemented to ensure operational order;

Risk Management Framework is

being developed by all divisions as it
supports good governance structure and
ensures business continuity;
Likewise Sassda is cognisant of
aligning and implementing its operations
to ensure statutory compliance.
Please go to Sassda News on page 30
for an update on all its activities

CRONIMET
(R.S.A.) (PTY) LTD

VLEKVRYE STAAL

Buyers of stainless steel scrap

Suppliers of quality graded secondary
raw materials to mills and foundries
locally and internationally
A major stainless steel scrap
recycler in South Africa

STAINLESS STEEL

JOHANNESBURG
6 Fuchs Street
Alrode Ext. 2, Alberton
Tel: 011 908 1620
Fax: 011 864 6604
www.cronimet.co.za
12

DURBAN
Mason Road
Amanzimtoti, Durban
Tel: 031 903 5628
Fax: 031 903 2166
www.cronimet.co.za
June 2011

Fabrinox prides itself on high levels of customer

satisfaction through quality products delivered
on time to customer requirements. To remain
true to this goal and to exceed customer expectations, it is important to engage the supply
chain in a structured way. Fabrinox honours its
suppliers annually by presenting a Supplier of
the Year Award.
The 3 finalists for the Fabrinox Supplier
of the Year Award for 2010 were Elcarbo Industrial Supplies (PTY) Ltd, Macsteel Fluid Control and Donnees Engineering.
Suppliers are rated throughout the year
on quality of product and on-time delivery. The
final winner was Donnees Engineering and
the award was presented at a recent function
in Bellville.
According to Heidi Kotz, head of
marketing at Fabrinox, the awards are mainly
focussed at ensuring seamless cooperation between Fabrinox and its suppliers. Industry can
only perform as well as allowed by the performance of its stakeholders and as such it is
important to be benchmarked against global
competitors.
In a recent survey completed by the
United Nations Industrial Development Organisation, Fabrinox showed its competency
by emerging as a world-class company. The
benchmark not only rated companies in terms
of hard output, but also evaluated the internal
processes and people management within the
company.
Fabrinox has proven itself to be a truly
global competitor and surely should be ranked
as a solid example of an organisation in
South Africa trying to enter and compete in a
very tough world market.
Supplier relationships are the key to
continuous improvement of service delivery
and quality in the stainless steel industry and to
launch the local industry to a global platform.
Fabrinox sets an example of how suppliers can be engaged in a productive and
positive manner to the advantage of all industry stakeholders and ultimately the end-users of
stainless steel products proudly made in South
Africa.
June 2011

Winners Ben Steenkamp (Fabrinox), Frederick Maintz (Macsteel

Fluid Control), Andr Visser (Fabrinox), Johan Koen (Donnees
Engineering) & Wendy Turton (Elcarbo Industrial Supplies)

13

company

Air Products is embracing a new philosophy to target all markets.

In a chess Game of strategy, the gas company believes
it is finessing its skills to offer the best product and services

PROFILE

Air Products South Africa:

Giants of gas

A New Look at Corporate

Strategy and the Role of
Industry Associations
By Seelan Gounden, General Manager:
Bulk Gas, Air Products South Africa
Central to our corporate strategy
at Air Products is a very simple philosophy: take the time to understand the market. This refers to both the wider economic context as well as individual market
segments. Keeping ones eyes and ears
open and finely tuned to the environment
can determine not only a companys success, but also its very survival.
Gone are the days when a companys corporate strategy was formulated by CEOs behind closed doors (of
a boardroom) where strategic decisions
were cast in stone. That kind of insular, even complacent thinking has become very dangerous in todays business
world. In the past couple of years, many
companies have learnt the hard way
how important it is to read the market
correctly.
Of course, we have learnt that
much of what can happen in the broader
economic world is unforeseeable; however, while we cannot always accurately
predict the future of a certain market, we
can at least anticipate changes and be
flexible enough to grow and adapt to
change when it happens.

Air Products specialised welding gasses are used in the manufacture of

vessels for the stainless steel industry as well as many other applications

All Things To All People

Strategy has not always included
a flexible, responsive approach. The
gas industry as a whole has to an extent
been guilty of rigid thinking in the past.
Gas is, and always has been, one of
those basic commodities used in every
conceivable industry. We supplied according to demand, and, because of the
ubiquitous nature of gas, soon became
all things to all people. Gas is an age14

old industry, historically dominated in the

past by a dinosaur approach - slow to
change and in a strategic comfort zone.
Some years ago, it became evident to us at Air Products that we needed
to refresh our thinking. We realised that
the industry had changed, that there
were new market segments, and other
segments were moving in new directions, that smaller independents started
emerging and knocking on the door, and
that there were new industry drivers.
Suddenly business cycles were
much shorter three years at the most.
It was necessary to start examining the
way we did things, with a focus not so
much on what we had been doing right,
but what we had been doing wrong.
It became clear that we needed
to sharpen our focus: to target markets
more precisely, to focus on optimising
our business through a new look at different supply modes, gas sources and
applications.
Thus, we formulated a five year
strategy, which is now in its third year and already we are seeing the fruits of
this change in approach.
Back to Basics with the Strategy Roadmap
As part of our rethink we went
back to basics and revisited the question
of what is strategy, and how important
the concept of strategic intent is in an
industry such as ours.
While strategy is often linked to a
corporate vision and mission, it is at the
same time simpler and more complicated than that. Strategy is, in simple terms,
a companys roadmap for its journey.
As such, it provides a company
with direction and focus, both of which
are key to any journey, business or otherwise. It answers two of the most essential
questions of all: What do we want?
and Why do we want it?

Strategy versus Operations and

Tactics
The simplicity of those questions
brings a laser focus on the bigger picture; and forms a cohesive vision of a
companys very reason for being. Many
South African companies are very strong
on the operational side of things, and
less so on strategic intent. In fact, they
often confuse operation and tactics, with
strategy. It is easy to get bogged down
with detail and a constant analysis of the
here and now.
The chess game of Strategy
It is always useful to illustrate the
concept of strategy with the analogy of a
game of chess. Here, strategy becomes
more than a roadmap or goal. It takes
on both a defensive and an offensive
position; you consider your next move
in relation to your opponents position
- always keeping your eyes open and
anticipating a change of scenario.
There is a constant tension between attack and defence, between
reacting and striking: strategy in this instance is no longer a simple question,
and it is not just about waiting to see
what happens. It becomes a dynamic
force, filled with intent.
The game of chess also illustrates
the difference between strategy and tactics, and how they necessarily go handin-hand. While strategy is the battle
plan, tactics refer to individual moves,
the operation of a business. This is the
detailed, more finely tuned side of the
business that people tend to get lost in.
End Goal Keeping it in Mind
South African companies are
good at reacting and thus at tactical intent. But we do not always understand
the overarching question: Why? Without that understanding, we are effectively
wasting our time. The key is to never lose

March 2011
June 2011

15

company

PROFILE

Air Products is committed to optimising the way it

supplies and services the end market

sight of the end goal in the wider context.

By doing so, a company will keep its focus
on its core competencies which in turn will
lead to a strong sense of direction and focus in its people.
A Supply Chain Company
Air Products core competency has,
historically, been our On-site business
servicing the larger user through investing
in huge ASUs (air separation units). This
formed the base load of our business,
a platform for the development of other
modes of supply, such as pipeline gas or
smaller liquefiers. Other gas companies
grew in different directions, but overlapping was inevitable. With the ASU market
having finite capacity, and requiring ma16

jor capital investment which could only be

seen in long cycle terms, Air Products has
had to re-examine other segments, as well
as other modes of supply.
Producing gas has always been our
primary function, but our new strategy has
forced us to focus on optimising the way
we supply and service the end market; and
thus we no longer see ourselves as a gas
company. We are a supply chain company.
The main drivers of the gas industry
have also changed over the years: the use
of energy is the single biggest cost for Air
Products nowadays, which has significantly
impacted on our strategy. For example, it
has forced us to reconsider other, and in
some cases, older technologies, which

have become increasingly (and perhaps

unexpectedly) viable, such as cryogenic
freezing.
Cryogenics represents a much more
flexible technology which is less dependent on electric power, and which would
considerably reduce a companys carbon
footprint.
Industry Associations Adding
Value to Strategy
Testing different market segments
and keeping up to date with technology
requires market intelligence, and industry
associations, such as Sassda, can add
tremendous value, and indeed feed a
companys strategy. As a forum for an industrys stakeholders, customers and suppli-

ers, industry associations play a valuable

networking role, creating opportunities
for gathering nuggets of market information. Participating in such forums enriches
ones understanding of an industry outside
of ones core competency. It gives one a
much better sense of what the future may
hold, and helps to keep ones eye on the
bigger picture.
In addition, an industry association
which takes a proactive stance, such as
Sassda, can impact on a companys bottom line from the point of view of helping
to identity and generate business opportunities. As such, Sassda has acted as a
business development tool for Air Products,
giving us direction in terms of our strategic
intent within a particular industry. By help

ing us test a market, it provides an invaluable industry benchmark on which to base

our strategy.
Industry Watchdog
Sassda, in particular, has taken on
an industry watchdog role, championing
the local content cause, which has a ripple effect on associated industries, including gas. The stance that Sassda takes on
education, training and upliftment, also sets
it apart from other industry associations: it
is a position which cultivates not only the
stainless steel industry, but industry at large.
A valuable aspect of industry associations is that, as a forum for the various role-players in a specific industry, they
encourage commonality and not diversion

or disagreement. By focusing on common

aims, they promote industry standards, consistency and professionalism. In this way,
associations such as Sassda are driven by
the industry at large with all stakeholders
working towards a common, mutually beneficial understanding.
Constantly Revisiting Strategy
While a company can, and must,
have a five to ten year vision, it needs to
constantly revisit its strategy so that it is in
tune with the wider business context, both
local and international, fed through the conduit of industry associations. This strategy
should be flexible, measurable, and designed to adapt to todays shorter and at
times volatile demands and business cycles.
17

company

PROFILE

Falcon Engineering
launches training centre

Falcon Engineering has launched a

training centre to train artisans in the
trades of boiler making, welding, and
fitting and turning.
What makes our training centre
uniquely different is that we will incorporate stainless steel into our practical
and theoretical courses, says Falcons
Clarrie Parkins.
Falcon Engineering is a manufacturer of stainless steel tanks, vessels
and pressure equipment.
The Falcon Training Centre was
launched to help a sector that is in
dire need of skills. The skills shortage
is hurting manufacturing businesses in
every sector, says Parkins. As an artisan who learned my trade at an early
age and built my business from the
ground up, I realise the importance of
what a skill gives a person. Johnny Dos
Santos and I have created this training
centre because we feel we have valuable skills and insights that we can use
to develop the steel sector.
Dos Santos is Parkins right hand
man on the project. He has been a
trainer in the sector for over 20 years
and believes that this centre offers
artisans training in everything they
could need. In an industry where three
quarters of work completed requires
a rework, these skills are desperately
sought after. Dos Santos does not believe there are many places in South
Africa that are training artisans correctly and has seen enough badly trained
artisans to believe that what Falcon is
doing will help rectify this.
The first apprenticeship course
is currently underway at Falcons new
training facility and three of the apprentices are about to sit for their trade tests.
We have 10 apprentices from Falcon
currently completing the training, says
Dos Santos. Once they have passed
their trade tests, they will become
skilled artisans who do not require any
18

The courses, held at Falcons premises, focus on

welding, boiler making and fitting and turning

Artisans will learn skills on all metal types including stainless steel
June 2011

further training unless they wish to specialise in other fields such as quality
control, inspection or as a supervisor
in workshops.
The course is essentially 48
weeks long and is organised into four
phases where learners participate in
theory and in-house practical. Between
courses the apprentices can apply
what they have learned in the industry
as well as take the opportunity to earn
a salary or wage.
Training to become a skilled artisan takes five years, including the trade
test. The training centre provides courses
that can train 24 people a day; 12 on
June 2011

practical and 12 on theoretical aspects.

Smaller courses ensure each learner
achieves the best training. Courses are
structured to be short and stand alone or
a long continuous course.
Artisans are trained in all steels
from mild and carbon steel to stainless and the more exotic steels, such
as titanium. Companies can send their
employees on the courses and benefit
from their training. However, courses
are also open to the individual.
The Falcon Engineering Skills
Development & Training centre is currently in the process of getting its Merseta accreditation, which should be

awarded at the end of July 2011. The

courses use Recognition of Prior Learning (RPL), which means artisans with
adequate experience will benefit from
a shorter course and thus allow them
to sit for their trade test, provided they
meet trade test requirements.
Parkins says that one of the key
incentives for artisan training is for personal development. An entry level
salary of R3 900 per month can be
increased to more than R20 000 a
month after an artisan is fully skilled.
Parkins and Dos Santos are fully
committed to changing the skills shortage, one artisan at a time.
19

industry

company

tribute

Profile

Obituary: An industry stalwart

Colin West

Colin West, a highly respected welding and gas industry stalwart, expert and long-serving employee of
Air Products South Africa, has sadly
passed away after a long illness
bravely borne.
Colin, who has been described
by colleagues as the best welding
product specialist that the company
has ever had, certainly left his mark on
the industry. His passing will also leave
a gap for many Air Products customers
who grew accustomed to receiving his
sound advice and support, based on
many years of his experience.
Colin joined Air Products in
October 1990 and, armed with a
number of international welding certificates, dedicated his career to the
development of his specialist knowledge of the different gas compositions and their effect on the welding
operation.
His metallurgical knowledge,
combined with his extensive practical
welding experience, placed Colin in
a unique position to provide expert
and complete solutions to any customer query or problem.
Heavily involved in the training of both sales engineers and distributors, he took pride in imparting his
knowledge to anyone who was interested in learning.
Colin was passionate about
young South Africans having the opportunity to further their careers; and
was a strong and vocal supporter of
the SAIW and the SAIW Young Welder of the Year Competition.
Equally competent on the workshop floor and in the boardroom, Colin was always both professional and
friendly in his dealings with colleagues
and customers. Not shy about putting
forward his ideas, which at times were
innovative and pushed the envelope,
he always kept in mind his customers
20

Stalcor resurrected
from old KMG group

Stalcor, a major supplier of stainless

steel and aluminium to South African
industry, has been a trusted name with
a proven track record for many years.
The company has, in more recent
times, traded under the name KMG
Steel Service centres.
Under new management and
with the continued support of its major
shareholders, Blackstar Group, a decision has been made to resurrect the
Stalcor Brand.
Many of our customers, have
never stopped using the Stalcor name
and it has always been associated
with reliability, competence and service of the highest degree, says Willem Fourie, the newly appointed general manager.
We have been through some
tough times in this industry, but we have
emerged as a better structured and refocussed unit; we feel that the new
emblem and re-vitalised image will be
in line with our objectives of continuous
self- improvement, says Fourie.
Stalcor has been an appointed
distributor of Columbus Stainless and
Huletts Aluminium for many years. It
imports products that are not locally

General manager Willem

Fourie believes the new image will
help refocus the company
produced to add to the wide range
of products offered by their countrywide distribution network, which has
branches in all the main industrial
centres.
Among the companys main assets are a self-owned fleet of delivery
vehicles and the ISO 9000 quality certificate, says Fourie.

However, Fourie believes the

companys strength really lies with its
experienced, professional and technically competent sales team.
Stalcor has always been a
market leader in the supply of aluminium products in South Africa, says
Craig Du Plessis, Stalcors national
sales manager.
It is our intention to entrench
ourselves and further expands this market, he adds. Aluminium has long
been under-utilised in Southern Africa
when compared to the Americas or Europe and we aim to rectify this situation
with a new emphasis on the product.
says Du Plessis.
Stalcors intention is to broaden
its customer base by investing in new
product development and penetrating
new areas and territories. New management means new ideas and Stalcor is looking at widening its range of
products. This may include new wearresistant products for the mining and
earthmoving industries, says Fourie.
The company supports black
enterprise development and is taking
further steps towards improving its BEE
status.

Colin Wests passion and enthusiusm will be missed

needs and finding the best possible
solution for them. He showed a deep
understanding and commitment to his
customers, who in turn found his advice
practical and trustworthy.
Colin, who was well-known in
the industry, will be remembered for his
direct yet friendly approach. Not one
to suffer fools gladly, he shared his expertise in a way that made people sit
up and take note.
When he was not solving welding issues, Colin was passionate

about golf, talked constantly about

his sons, and enjoyed winning arguments with colleagues over fish and
chips and a beer.
After Colins retirement in 2008,
he returned to Air Products on a contract
basis as Manager of Welding and Cutting Gases, a role he ably and expertly
filled until his passing in April 2011.
Colins passion, friendship and professional contribution will be sorely missed
by all who were fortunate enough to
know him.
June 2011

June 2011

21

Q&A
with Damian Kotecki

22

Table 1: Composition Analysis

410
C, %
0.10
Mn, %
0.4
Si, %
0.2
Cr, %
12.0
Ni, %
0.1
Mo, %
0.02
Cu, %
0.05
Nb, %
0.0
N, %
0.01
WRC-1992 Creq
12.0
WRC-1992 Nieq
3.8
WRC-1992 FN
Martensite

metal compositions are plotted on the

WRC-1992 Diagram, and a tie-line is
drawn between these two points. By
the Rule of Mixing, all possible mixtures of the two base metals must lie
along this tie-line.
Assuming that each base metal
contributes equally to the dilution in the
weld metal, the point B (corresponding
to a synthetic base metal made up of
equal parts 410 and 304L) is drawn
as the mid-point of the tie-line between
the two base metals.
Then the proposed filler metal

304L
0.02
1.6
0.3
18.5
8.2
0.3
0.1
0.01
0.06
18.8
11.0
7.5

ER312
0.08
1.0
0.4
29.0
8.8
0.2
0.1
0.01
0.04
29.2
12.4
82.7

ER309L ER308L
0.02
0.02
1.5
1.5
0.4
0.4
23.8
20.5
13.5
10.5
0.05
0.1
0.1
0.1
0.01
0.01
0.04
0.04
23.9
20.6
15.0
12.0
13.4
11.3

composition (312, 309L, or 308L) is

plotted on the diagram, and a second
tie-line is drawn from the proposed
filler metal to point B.
Finally, assuming the normal
30% dilution (i.e., the weld metal
consists of 70% filler metal and 30%
of the synthetic base metal), point
W, corresponding to the anticipated
weld metal composition, is placed
on this second tie-line, 30% of the distance from the proposed filler metal
position towards the synthetic base
metal composition.
June 2011

Ni Equiv = %Ni +35(%c) + 20(%N) + 0.25 (%Cu)

Answer: ER312 is usually considered to be the cure-all for welding

difficult materials and for dissimilar
metal joints. The utility of ER312 is
that it will tolerate quite a bit of dilution
(up to 40% or more) from high carbon
steels. Even with such high dilution,
it will produce weld metal that solidifies as primary ferrite (which makes it
resistant to hot cracking in such joints).
And the weld metal will contain
enough alloy so that whatever austenite forms in the weld metal will remain
stable (not transform to martensite),
which makes it resistant to cold cracking. So it is a very safe alloy for 410
to 304L joints.
But it is not the only very
safe alloy, and it is definitely overkill
for 410 to 304L joining. ER309L is
equally safe, is readily available from
numerous suppliers, and is significantly less costly than is ER312. Furthermore, ER308L is quite safe, even more
readily available, and even less costly.
To understand why ER309L and
ER308L are safe, it is useful to examine typical compositions on the WRC1992 diagram, modified by adding
the martensite boundary as published
in the Welding Journal, May, 1999,
pages 180-s to 192-s.
To begin, we need typical
compositions for 410, 304L, ER312,
ER309L and ER308L. These are given in the table (table 1, right), along
with calculated Chromium Equivalent
(Creq), Nickel Equivalent (Nieq) and
Ferrite Number (FN) for each composition. Variation from these typical
values will not appreciably affect the
analysis.
The analysis procedure is the
same for all three potential filler metals. First, the 410 and 304L base

Ni Equiv = %Ni +35(%c) + 20(%N) + 0.25 (%Cu)

Question: Im welding 410 stainless

steel fins to a 304L stainless box.
The joints are fillet welds, and we
are using GTA with ER312 filler metal. ER312 filler metal is not so easy
to get, and it is expensive. Is there a
lower cost alternative?

Ni Equiv = %Ni +35(%c) + 20(%N) + 0.25 (%Cu)

welding

Figure 1 - Joining 410 to 304L with ER312

18
16
14
12
10
8
6
4
2
0

Martensite Boundary @ 1%Mn

8 10 12 14 16 18 20 22 24 26 28 30

Cr Equiv = %Cr + %Mo +0.7 (%Nb)

Figure 2 - Joining 410 to 304L with ER309L

18
16
14
12
10
8
6
4
2
0

Martensite Boundary @ 1%Mn

8 10 12 14 16 18 20 22 24 26 28 30

Figure 1 plots the analysis for ER312 filler metal on the WRC-1992
Diagram with the martensite boundary.
In Figure 1, the tie-line from the filler metal to the synthetic base
metal is easy to distinguish because it is not parallel to the iso-ferrite
lines. Point W, corresponding to the anticipated weld metal composition, lies within the high ferrite portion of the diagram, comfortably
above the martensite boundary.
For compositions above and to the right of this boundary, no
martensite is anticipated in the weld metal.
A large variation in the assumed dilution cannot cause the
weld to be ferrite-free, nor can it cause martensite to form in the weld.
So ER312 is a very safe filler metal for this joint.

Figure 2 plots the analysis for ER309L filler metal.

Now the tie-line from the ER309L composition to the synthetic
base metal composition is difficult to distinguish because it is nearly
parallel to the 12 FN iso-ferrite line.
From a metallurgical point of view, this is very desirable, because this means that large departures from the assumed 30% dilution
will produce virtually no change in the weld metal ferrite content.
Again, a large departure from the assumed dilution cannot
cause the weld to be ferrite-free. More than 70% dilution (highly
unlikely) would be required to cause martensite to form in the weld.
So ER309L is also a very safe filler metal for this joint.

Cr Equiv = %Cr + %Mo +0.7 (%Nb)

Figure 3 - Joining 410 to 304L with ER308L

18
16
14
12
10
8
6
4
2
0

Martensite Boundary @ 1%Mn

8 10 12 14 16 18 20 22 24 26 28 30

Cr Equiv = %Cr + %Mo +0.7 (%Nb)

FREE
SUBSCRIPTION
June 2011

Figure 3 plots the analysis for ER308L filler metal.

As with the ER309L, it is difficult to distinguish the tie-line from
the ER308L composition to the synthetic base metal composition, because it is nearly parallel to the 12 FN iso-ferrite line.
And the anticipated weld composition, point W, lies almost on
top of the 304L base metal composition.
Because the tie-line from the ER308L to the synthetic base metal
lies nearly parallel to the 12 FN iso-ferrite line, a ferrite-free weld cannot be produced i.e., there is no fear of hot cracking. Further, the
martensite boundary intersects the tie-line from the filler metal to the
synthetic base metal at a point that is 60% of the distance from the
ER308L to the synthetic base metal, point B. This means that at least
60% dilution would be required for martensite to appear in this weld,
which is quite unlikely. So it can be concluded that ER308L filler
metal is nearly as safe as ER309L filler metal for this joint.

Interested in getting your favourite stainless steel

magazine delivered to you or a valued client?
Contact us for a free subscription.
E-mail: melissa@stainlesssteelmagazine.co.za
or call: 0861 727732

23

industry

NEWS
KZN fabricators
Regional fabricators Update
The KwaZulu-Natal stainless steel market is
different from other regions in South Africa
in that there are a large number of stockists who supply into this market. This places
enormous pressure on stainless steel prices.
Stockists are facing strong pricing
competition from imported stainless steel
flat products, particularly grade 316 and
1.4003 (similar to our 3CR12).
According to industry sources there
are varying views from the major stainless
steel distributors: some say the market is

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June 2011

llll

TVRheinland

IS

24

w.t uv. co
ll l ll ll lllll

l ll ll l ll

quiet and others believe that sales

are excellent. However, this could
relate to the amount of stock specific
stockists have available.
The general feeling is that the
buoyant sectors are catering, refrigeration, food & beverage and automotive.
This is reflected in some of the
manufacturers experiencing strong
exports into Africa, Australia and
Europe.
The building and architectural
sector is finding market conditions
tough as there are no large projects
planned.
In the long term there is the
Dube Port expansion at Shaka International Airport that will involve
commercial, residential and hotel
development.
Some heavy fabricators are
also finding the market tough not
due to no future projects, but with
orders either taking too long to be
awarded or competing with Asia
and China where project pricing is
highly competitive.
The heavy fabricator sector
has experienced fluctuations over
the past few months as demand is
intermittent.

1050317

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Aluminium - light, strong and beautiful

industry

industry

NEWS

NEWS

IDC seminar

outokumpu

Manufacturing Insights Seminar

At the Infor seminar that took
place on Tuesday, 17 May 2011 in
Johannesburg, Craig Simpson (pictured
right) the Lead Analyst for Manufacturing Insights at IDC, CEMA commented
on the largest survey into global discrete
manufacturing ever undertaken in partnership with Infor.
Revenue, profitability and raw
material costs remain three of the main
concerns for manufacturing companies
in 2010 and 2011 with energy and fuel
cost concerns skyrocketing to the top of
the list, says Simpson.
According to the research findings, South African manufacturers are
embarking on a more aggressive and
risky approach that is focusing on extending into new markets and finding
new customers. The third world market is
also actively developing innovative products and developing new services in the
face of adapting to an ever-changing
market. The first world manufacturing
market is a vastly different playing field
with manufacturers following a more
conservative route that focuses on retaining and growing existing customers and

26

Coega

improving productivity, says Simpson.

Arsenin Rodriguez, the Strategic Solutions Director for Infor, says that innovation has become a core activity for manufacturers. Innovation is the key to how
manufacturers plan to meet their strategic objectives. Support is however needed to
ensure that their investments match their ambitions, says Rodriguez.
The availability of skilled resources is ranked as the top inhibitor to innovation,
says Simpson. The prevailing lack of skills in South Africa is a very real threat to the
intellectual property that we offer to customers. Many companies are outsourcing
key functional aspects of their business to outside providers that are essentially diluting the unique product offering that you give to the end user, and that is something
we need to guard against, concludes Simpson.

Outokumpu wins ISSF sustainability award

The International Stainless Steel Forum (ISSF)
has granted the first ISSF Sustainability Award for Outokumpu. The acknowledgement was received at the
ISSF Annual General Meeting in Madrid, Spain on
22 May 2011. The recognition was based on Outokumpus determined actions and great achievements
in reducing waste to landfill and increasing material
efficiency in Sheffield.
David Martin, chairman of the ISSF Health & Environment Committee comments: Outokumpus Sheffield
melting shop case is an excellent example of sustainable
development. Minimising waste is in everyones interest and this case demonstrates significant improvements
with clear figures.

Outokumpu established a sustainable recovery

and re-use route for different stainless steel waste in Sheffield. Slag was re-used in the production of asphalt and
waste refractory material was used as a substitute for
limestone in the stainless steelmaking process.
These actions have led to dramatic reduction in
waste to landfill. Since 2007 over 80% of all slag has
been recovered and re-used as road stone in the asphalt
production. During 2010 half of all refractory waste
generated on site was re-used as a lime substitute.
Outokumpus CEO Mika Seitovirta comments:
Im pleased and honored to receive recognition for our
efforts in the area of sustainability. This encourages us to
work towards our long-term target - minimum waste in
the production process.
June 2011

Manganese plant for Coega

Kalagadi Manganese is investing R4.2 billion for the construction of a
smelter plant with an annual production capacity of 320 000 tons of High
Carbon Ferromanganese (HC FeMn) in the Coega IDZ, Eastern Cape. The
spending related to the construction of the smelter would result in direct, indirect and induced output of R7.3 billion in the Eastern Cape.
It is expected that about 1 000 jobs in the Eastern Cape Province
would be required during the construction phase of the project. It is also estimated that the smelter plant will create approximately 400 permanent jobs.
The share of jobs sustained by the project would be semi-skilled and unskilled
jobs (28%), informal jobs (36%), skilled jobs (28%) and high-skilled jobs (8%).
The construction of the smelter is expected to start in the third quarter of 2011. Manganese is a critical ingredient in metal alloy production
including stainless steel and other steels and aluminium. This investment
therefore will kick start the planned development of the heavy metals cluster
at Coega. The benefits for manufacturing in general and the auto sector in
particular are obvious. Manganese is also a foundation for dry cell battery
manufacturing, which supports our strategic focus on the green economy.
All of this fits neatly within our Provincial Industrial Development Strategy.

industry

sassda

NEWS

NEWS

28

been awarded sole distribution rights for ESABs world-renowned automated cutting
machines.
Chris Eibl (pictured above left), ESAB head responsible for sub-Saharan Africa,
says he is pleased that Goscor has decided to focus on ESAB products. They are a
thoroughly professional outfit and before ESAB had formal presence in South Africa they
played a major role in building the ESAB brand in this part of the world, says Eibl.
He adds that ESAB sub-Saharan Africa was ESABs last frontier when an office
was opened in Johannesburg last year. Represented globally in almost every region
where we are either number one or two in sales, we now have a head-office in Johannesburg with branches in Cape Town, Port Elizabeth and Durban and this is helping us
to rapidly expand our footprint to countries such as Angola, Nigeria, Gabon, Kenya,
Zambia and Tanzania. Having Goscor Arc as our Tier 1 distributor focusing exclusively
on ESAB will be a significant help to us in our endeavours to continue building the
brand in this region, Eibl says.
ESAB is famous for its state-of-the-art technology and innovation like the VACPAC, which eliminates the need for the baking of electrodes, significantly saving time
and money, and the Aristorod MIG wire, a non-copper coated MIG wire with patented
Advance Surface Characteristic (ASC), which eliminates spatter, facilitates easy feeding and produces one of the most consistent of welds of all known welding wire.

Avesta provides stainless welding solutions

With its solid base and strong brand reputation in
the welding of stainless steel Avesta Welding is on track
to raise its market profile. This drive will be evident in
various ways during the coming year. We are focusing
on achieving preferred partner status for the welding of
stainless steels, said divisional manager Bohler Welding
SA Wade Lessing.
We provide a solutions based approach from single applications up to project level with Avesta Welding
products and finishing chemicals and have the resources
to meet customer expectations. We know what it takes to
weld and post-treat a wide range of applications in the

most economical way while still ensuring the best possible service life of the components.
The world class range of Avesta Weldings ASME
approved products include high-quality user- friendly filler
metals for all conventional welding methods and, in principle, for all stainless steel and nickel base parent metals
currently used with approval and success internationally
in the chemical and petro-chemical industries.
Avesta Welding solutions, applications and support are available from the countrywide network.
For more information call any branch nationwide on 011 970 1837, 031 700 5563, 041 453
3180 or 021 534 3551.
June 2011

Air Products provides gas solutions to mines

Air Products South Africa has been making ever
deeper inroads into the local mining industry.
Because gas, in many forms, is a vital component in a variety of mining processes, the company has
established ongoing supply relationships with a number
of Southern African mining operations, including some
of the biggest gold, platinum and iron ore producers in
the country.
This is according to Rob Richardson, Air Products
General Manager: On-site, who asserts that the spectrum of gases applicable to mining is as wide as the
variety of applications and mining processes themselves.
Gas affects almost every aspect of mining operations,
including human safety, quality control of the metals, productivity and environmental health,
Richardson continues: The gases used in mining
include an assortment of both industrial and specialty (or
high purity) gases. Industrial gases used on a daily basis
are oxygen, hydrogen and nitrogen, but also include
dissolved acetylene, LPG (liquid petroleum gas), carbon

dioxide and argon.

Richardson explains that oxygen, which forms the
main part of Air Products Bulk Gases supply to the mining industry, has three important functions when it comes
to metal extraction: Firstly, because it effects faster reactions, its presence in the leaching, roasting or smelting
processes both increases yield and reduces the processing time, thus improving overall productivity. Secondly,
oxygen is used to remove impurities (such as sulphur and
carbon) in metals; and thirdly, the use of oxygen provides
environmental benefits by decreasing the volume of emissions, thereby making them easier to treat or recover.
Nitrogen is also used frequently in mining operations, most commonly to extinguish underground fires, but
also in hot metal processes, to control oxidation, as well
as to control furnace atmospheres.
Apart from these base gases, Air Products also
supplies a variety of specialty blended welding gases to
the industry, and recently the company has had a great
deal of success with the use of ozone in the destruction
of cyanide, used in the gold leaching process.

Leading the way as

suppliers of
stainless steel fasteners.

Epping
+27 (0)21 505 1000

June 2011

Montague Gardens
+27 (0)21 552 1196

Vredenburg
+27 (0)22 713 4781

Port Elizabeth
+27 (0)83 448 2588

Durban

Johannesburg

+27 (0)31 705 1664

+27 (0)11 538 7600

RA&M 1/02/11

Avesta

Welding firm focuses on ESAB

Leading welding solutions and
equipment supplier, Goscor Arc, has announced that, in line with the Goscor
Groups drive to focus on and build its
key products within the group, it has relinquished the distribution of Lincoln products. We will concentrate on ESAB products. This will help our technical, sales and
support staff all provide a better service
and our customers will be the ultimate
winners, says Rob Pirie, Goscor Arc MD
(pictured right).
Pirie says that Goscor decided to
partner with ESAB because of his companys long history of success with them.
We go back a long way and, apart from
having great trust in the quality and range
of ESABs product, service and immense
technical know-how, there is a deep mutual respect, he says.
In terms of living up to Goscor Arcs
promise of providing a total solution to
customers welding needs, the close relationship with ESAB facilitates execution
of this promise says Pirie. We continue
to do what we have always done, which
is to provide our customers with the best
welding solution in a cost effective and efficient package irrespective of what hardware is required, he says.
Goscor Arc is ESABs only Tier 1
distributor in South Africa and has also

Air Products

gosarc

+27 (0)12 653 2534

29

sassda

sassda

NEWS

NEWS
Sassda signs MoU
Sassda is proud to announce
the signing of a Memorandum of
Agreement (MoU) with the SA Supplier Development Agency (SASDA).
SASDA is a state-funded supplier development agency, reporting to the
Department of Minerals and Energy.
SASDAs focus is on development of black suppliers and on assisting national government in meeting the national goals of economic
development and the improvement of
quality of life of all citizens. Sassdas
association with the Suppliers Development Agency serves to further
enhance our localisation efforts and
therefore promote Buy South Africa.

Farewell to Debbie Du Toit

Debbie du Toit, who has been in the
employ of Sassda since 2000 will be leaving
Sassda at the end of June 2011. She is relocating to the windy city of Cape Town with
her husband, Etienne.
Debbie has been an integral part of
the Sassda team over the past ten years. She
can proudly look back on all of her accomplishments at Sassda with satisfaction of a job
well done. Her professionalism, trustworthiness, piety and selfless consideration for everyone was a blessing to the office of Sassda.
Sassdas executive director Sethakgi
Kgomo says: Its been an absolute privilege
working with Debbie, and we wish her and
her family the very best for the future. Thank
you for your valuable contribution.

NEW MEMBERS

Appointments

MOU

Sassda membership at 472

Sassda gained nine new members during the period March 3 2011 to May 19 2011. Sassda currently has 472
members. There were three resignations during the period and 28 memberships terminated due to non payment of
membership fees. Listed below are the new members for 2011.
Company Description
FE Stainless Steel Products

Fabricator: process plants, construction, hospital

Banding & Identification Solutions Africa

Manufacturer of Stainless Steel strapping and buckles

Iskus Power

Power efficiency specialists

Spear Manufacturing

Manufacturer of patented Stainless Steel palisade fencing

Roar Construction

General Fabrication of mild steel and Stainless Steel

Ekamant SA

Suppliers of abrasive products to Elcarbo Cape

Sino Metals Distributor/Stockist/ Importer

Inox Manufacturing

Balustrades, steel staircases, bollards, steel gates, corner protectors

Mirage Steel Solutions

Stockist

Agrip

Manufacturer of Stainless Steel strapping and buckles

Deezee Precision Engineering

Precision machining of small to medium components & product assembly

KZN Golf
30

Sassda appoints new staff

Sassda recently appointed the following staff:
Clive Phillpotts has been appointed as the Technical Advisor for
the Kwa-Zulu Natal region. Clives
regional representation of Sassda includes the provision of technical support and the facilitation of member
services. Clives contact details are
031 765 7565 or 084 657 1923.
Marius Smith is now the External Relations and Public Affairs
Manager. Marius responsibility includes the mobilisation of industry
sectors, interest groups and working
groups in line with localisation opportunities benefiting the stainless steel
industry. Marius may be contacted on
082 907 1964.
Ken Dewar (pictured) is familiar to the stainless steel industry and comes
from Columbus Stainless. Ken assumes the role of Technical Consultant in support
of Sassdas technical services to its members and end-users.
We are very proud of the skills and expertise that we have managed to
attract in filling the above positions, says Sethakgi Kgomo, the executive director
of Sassda. He goes further on to say that Sassda is well positioned to ensure a
world class service to its members.

DOE meeting

Farewell

Sassda sponsors SAIW golf award in Durban

The South African Welding Institute (SAIW) held a golf day on June 2 2011 at the Durban
Royal Golf Club. Sassda sponsored the prize for the Most Golf Played who was one by the team
from ESSAB. In other golfing news, Sassda held their annual Sports day at Mount Edgecombe
Country club on April 12 2011.
June 2011

June 2011

Sassda meets with Department of Energy

Sassdas
executive
director, Sethakgi Kgomo, met
with the director general of the
department of energy, Ms Nelly
Magubane, in its bid to lobby
government for localisation of
projects within Department of
Energys Integrated Resource Plan (IRP).
A Sassda contingent highlighted the associations strategy
and objectives and engaged the Department of Energy to seriously
consider stainless steel and local fabricators capability to deliver
projects as specified in the IRP. A proposal was developed and submitted to the DG providing information on South Africas capability,
capacity and the advantages of specifying stainless steel in some of
its applications. Sassda is actively driving its Lobby Strategy which
will see the Executive Director in a number of high-level engagements.
While promotion of stainless steel usage is important to the association, local conversion remains a priority focus for Sassda.

ISO assistance
Sassda assists with ISO
The Sassda Strategic Plan as well
as the Article of Association imposes a
duty on the Association to assist and support its members to become nationally
and globally competitive.
To this end, compliance with the
internationally recognised standards for
quality and environmental compliance
become key requirements.
The critical requirement for
ISO9000
(general
quality)
and
ISO14000 (environmental compliance)
have become the prerequisite for doing
business with most overseas companies.
This message has been consistently expressed at UNIDO meetings where Sassda has a permanent representative.
Sassda is fortunate to have three
employees who are ISO Auditors and
qualified to help with ISO compliance
issues. They are Michel Basson in Cape
Town, Clive Phillpotts in based in Durban and Marius Smith in Johannesburg.
Sassda requires your information on the
extent of compliance of the industry and
have sent out surveys to members.

BEE rating
Sassda gets BEE Certificate
IQUAD Group Limited, a member of
Sassda, has recently assessed and certified Sassda as a Level 3 BEE Contributor. Sassda was assessed under various
criteria including Skills Development and
Enterprise Development. Sassdas BEE
Certificate is available to assist members in their tender procurement efforts
and is available to all paid-up Sassda
members. This bodes well for our members where Sassdas BEE status strengthens their business development. To get
your copy of the Sassda BEE Certificate,
kindly contact Sassda.
31

profile

BERNARD MAGUIRE

ernard Maguire is a
director of Cronimet,
the stainless steel scrap
recycler. He was also elected as
Sassdas chairman of the board
at the end of last year. Maguire is
no stranger to Sassda; he was the
organisations acting executive
director for most of 2010 and
helped re-establish the memberorientated focus of the group.
Ever private Maguire
allowed Stainless Steel a glimpse
into what drives the man.

Credit: Gerard Lazaro / Shutterstock.com

What are your career highlights?
Building Tillmor from a small stainless steel scrap
company into the business it is today: a part of the major
stainless steel recycling business Cronimet. Starting in
1981, and still being part of the first company in Southern
Africa which specialises in recycling stainless steel.
What is your best personal achievement?
My two sons.
What is your favourite stainless steel possession?
My coffee machine there is nothing better than a
great cappuccino after a ride or sitting relaxing with the
newspaper.
What is your favourite stainless steel building?
Guggenheim in Bilbao (pictured above) the lines,
curves and geometry really complement a wonderful
product.
How do you define happiness?
An African sunset in the bush, with an ice cold beer and
good company with my wife and friends.
What cant you live without?
My oxygen tank when Im scuba diving.
Describe your perfect weekend?
Sitting on the banks of the Zambezi it helps me
remember how privileged we are to be African.
Why stainless steel?
Tough, complex, attractive, resistant, yet potentially
vulnerable.
32

June 2011

Bohler Welding SA

Cape Town
Pinetown KZN
Port Elizabeth E/Cape
Gauteng, Thuthuka Welding

Tel 021 534 3551

Tel 031 700 5563
Tel 041 453 3180
Tel 011 970 1837