Sandton – Integrated, South African metals company, Alfeco Group has recently acquired the Hulamin Extrusions plant based in Olifantsfontein, Midrand. The extrusion assets which are now part of the Alfeco Group’s new aluminium division with a design capacity of 20 000 tons per annum has been renamed, Veer Aluminium.
The acquisition of the aluminium business signals further growth and commodity diversification to include in its ferrous and non-ferrous metals portfolio. The aluminium extrusion business is a growing and niche supplier to various sectors, industries, and value-added manufacturers from construction, electrical and renewable energy, automotive, industrial, consumer products and packaging.
It is expected that this will assist in underpinning economic growth and expansion. Veer Aluminium is currently recommissioning the operation and is also in tandem embarking on a significant expansion project.
The expanded plant will strategically incorporate a fully integrated model that will be based on the recycling of aluminium scrap. Currently, it is estimated that South Africa recycles only 5% of its aluminium compared to a global leader such as Brazil which reprocesses some 95% of its aluminium.
It takes only 5% of the energy required to remelt scrap as compared to primary aluminium production. Of all the aluminium produced in the world to date, some 75% is still in circulation and use.
Veer Aluminium estimates that South Africa will experience a sharp growth in recycled aluminium primarily due to competitive cost economics, wide-ranging applications, significant environmental benefits, and lower capital intensity.
The Group’s strategic vision is to establish, grow and expand integrated metals beneficiation through innovation, technical expertise, and cost competitiveness. The acquisition of the aluminium business aligns with this vision.
A key objective being pursued through the expansion is to create a secondary aluminium ecosystem and hub. This will create an opportunity to offer a multitude of value-added products, replace imports, establish a circular economy, and generate sustainable employment.
Sachin Ahuja, Chief Executive Officer of the Group stated, “The acquisition of the aluminium extrusion business and the establishment of Alfeco Group’s aluminium division further underlines our strategic vision of becoming a leading integrated metals producer. Growth in all three of our divisions is based on sustainable production, energy-efficient technology and employment creation.”
At present, South Africa imports all of the raw material (alumina) to produce primary aluminium. Some two-thirds are exported while the remaining aluminium is processed to value-added products.
However, a large proportion of aluminium scrap generated is either disposed of in landfills or exported as scrap. Almost 40 000 tons of finished, extruded aluminium product is imported into
South Africa annually.
Veer Aluminium believes that the opportunity created by import replacement, innovation and technology in recycling aluminium, sustainable employment and the establishment of a circular economy will underpin the Department of Trade, Industry and Competition’s (DTIC) industrialisation policy.
Ahuja added, “The first phase of re-establishing the extrusion operation is well underway and is expected to come on-line at the end of Q2 2021. This is to be followed by the second phase which involves the expansion of the plant to encompass, scrap processing, melting, casting and rolling. This will require significant capital being injected into Veer Aluminium.”
Furthermore, Veer Aluminium and the Council for Scientific and Industrial Research (CSIR) are currently discussing a co-operation partnership that aims to focus on research, development, innovation, creating an aluminium-based circular economy and helping to improve the livelihoods of all South Africans.
“The extrusion business together with the new integrated operation will result in the creation of an estimated 650 new jobs. We have also had a successful partnership with MerSETA in our other divisions in which opportunities have been afforded to unskilled, underprivileged and unemployed youth to gain necessary skillsets. This will also be rolled out in the new business for communities in the surrounding areas in Ekurhuleni,” concluded Ahuja.
About the Alfeco Group
The Alfeco Group is a new generation integrated metals company based in South Africa. It comprises three divisions, namely: aluminium, copper and ferrous. Alfeco currently has three operating companies, Veer Aluminium (aluminium), Pioneer Metals (copper and copper-based alloys) and Veer Steel Mills (ferrous).