Nigeria begins export of steel in April

Nigeria's dream of becoming a major player in the steel sector is finally coming to reality, as its first consignment of steel for export begins this month. African Foundries Limited, a foreign company operating in Nigeria, will begin export of steel to Ghana this April, to finally break the jinx and put the country on the global steel map.
African Foundries Limited, with production capacity of 500,000 tons of steel billets, has a state of the art continuous rolling facility, and is the only TMT producing mill in Nigeria, and its first export consignment is about five metric tons.

Sanjay Kumar,the company’s managing director, said exports would commence on April 27, 2013.

“Today is a proud and pleasant moment, and we are showcasing our feat to announce the breakthrough, because we have started to produce for export,” Kumar declared, adding that the firm started with one five ton capacity induction furnace in 2010.

Kumar added that the company now has multiple furnaces of bigger capacity, along with a re-bar mill and a structural rolling mill, with current capacity at 500,000 tons per year.

“With this plant and the two others in Ikorodu, Lagos and Suleja, in Niger state, we are targeting 1 million metric tons per year to be able to position ourselves for the 1.5 million metric tons Nigerians demand for steel.”

African Steel mill has 200,000 metric tons capacity while Abuja Steel mills in Suleja which will be commissioned soon have 150,000 metric tons per year capacity.

Kumar said the company's products are at par with what obtains in other parts of the world, adding that the main component is scraps sourced by about 5,000 otherwise unemployed youths.

African Foundries' clients are drawn from the construction industry, where lots of heavy construction projects are on-going across the country. This is complemented by the normal market consumption from the 36 states.

“Big construction firms depend on us and we produce to their specifications”, says Kumar who highlighted several challenges of which infrastructure and import duty regime are key.

“The steel industry will develop better, if the import regime is favourable. Nigeria is one of the richest ,especially in iron-ore, and the development of the industry will put the country at par with others in five years,” Sanjay said, adding that infrastructure such as good roads is hampering production.

The country’s feat is coming on the heels of the Federal Government’s protracted failures to develop the steel sector due to mismanagement and abandonment of its several steel companies.

The Federal Government in 1971 established an extra-ministerial agency called “Nigerian Steel Development Authority” (NSDA) and backed up by Decree to focalise efforts required to focalise a steel plant.

The agency that was later dissolved, gave birth to Ajaokuta Steel Project, Ajaokuta, Delta Steel Company, Ovwian - Aladja , Jos Steel Rolling Company, Jos , and Katsina Steel Rolling Company, Katsina.

Others are Oshogbo Steel Rolling Company, Oshogbo, National Iron Ore Mining Company, Itakpe, National Steel Raw Materials Exploration Agency, Kaduna, National Metallurgical Development Center, Jos and Metallurgical Training Institute, Onitsha.

Today however, despite the huge resources ploughed into Nigeria’s steel industry, the sector has been comatose and Ajaokuta Steel Complex, Kogi State; Delta Steel Complex, Aladja, Delta State; Osogbo Steel Rolling Mill and Katsina Steel Rolling Mill, are in pathetic situations.

But where the government has failed, African Foundries Ltd, a flagship of the African Steel Mill group, commissioned in 2011 and located in Ogijo, Ogun state has succeeded and will begin export of about 5,000 metric tons of TMT rebar to Ghana by the third week of April