ArcelorMittal South Africa [JSE: ACL] has decided to wind down its steel operations at Saldanha, which have been suffering "severe financial losses".
According to the company's website, 568 people work at the plant which has produced steel products for more than two decades.
As part of a strategic review of its operations, the steel manufacturer found that its Saldanha operations had lost their competitive cost advantage to compete in the export market, "mainly due to raw material and regulated prices".
ArcelorMittal says Saldanha's losses were forecast to continue for the foreseeable future. The plant's production facilities will be shut down, which will leave it only on "care and maintenance" by the first quarter of 2020.
"This difficult decision was taken in the context of constructive ongoing engagements with key stakeholders, including government and organised labour, to find alternative solutions to the dire situation in the South African steel industry," the company said.
Sales orders will be fulfilled from the group's Vanderbijlpark Works.
The company is still deciding on the future of its Newcastle operations, and certain of its long steel products rolling facilities.
"Exploration of the benefits of a concentrated operating footprint will be of foundational importance during this phase of the review."
The company, which announced planned retrenchments as part of "large-scale restructuring" in July, has concluded the CCMA-facilitated consultation process and will now implement the "outcomes" from the process, it said.