Manufacturing

The Blue and Green economies hold potential for KZN manufacturers.

SECTOR INSIGHT

ArcelorMittal SA turned a profit for the first time since 2010. • Africa Bespoke Apparel has opened in Verulam.

The manufacturing sector contributes 17.7% to the provincial Gross Domestic Product (GDP) of KwaZulu-Natal. The strongest export sectors are base metals (32% including aluminium), mineral products such as ores, vehicles and chemical products. New opportunities in the Blue economy (ship-building and maintenance, oil rig repair and servicing) and the Green economy (solar panel manufacture, solar, biogas and wind energy plant construction, management and maintenance, heating and cooling devices) are set to grow in KwaZulu-Natal with the allocation of geographical hubs to support these sectors, and the introduction of policies and incentives designed to make them competitive. The Richards Bay Industrial Development Zone has been identified as an area that can attract investment in both of these sectors while the Port of Durban already has a strong boat-building and maintenance sector. The nine-tug contract put out by Transnet National Ports Authority (TNPA) is worth R1.4-billion and was won by Durban-based Southern African Shipyards in Durban. Most of the tugs have been built and sent to ports around the country. iLembe District Municipality is intended as the renewable energy hub of the province, with renewable energy components manufacturing as a key subsector. The first beneficiary of national government’s black industrialist support programme was revealed in January 2019 when Africa Bespoke Apparel launched its R81-million factory (pictured) in Verulam. Various interventions in the textile, footwear and clothing sector have helped to revive the industry. The footwear sector in particular is showing good recovery after taking a battering from Chinese imports. The purchase of 39% of Eddels Shoes by management and staff has paid off, with 385 staff employed in making 2 700 leather shoes every day. Two international safety footwear firms operate out of Pinetown: Bata Industrial and Beier. The latter company has joined forces with three other South African safety footwear manufacturers to form the BBF Safety Group. Shanghai, with which KwaZulu-Natal has signed a memorandum of understanding, has agreed to run an exchange pro gramme fo cussing on clothing and textiles. Canvas and Tent Manufacturing (Pty) Ltd has more than 400 employees in Ladysmith. There are 219 clothing companies in the province (Coface). Ninian & Lester has about 1 500 employees. Carpet manufacturers Belgotex Floorcoverings and Ulster Carpets have facilities in Pietermaritzburg and Durban respectively. Home appliance manufacturer Defy, which is part of the Turkish group Arçelik, employs about 2 600 people. Böhler Uddeholm in Pinetown produces tooling materials and welding consumables.

Chemical assets

Two large oil refineries and a sophisticated sugar milling and refining industry underpin provincial chemical manufacturing. The chemicals and petrochemicals subsector makes up 17% of the manufacturing output of KwaZulu-Natal, with industrial chemicals accounting for nearly a third. Steel and aluminium are other heavy manufacturing products. The automotive industry is covered in a separate article. Newcastle is a chemical manufacturing hub. The big steel works of ArcelorMittal SA produce by-products such as ammonium sulphate, and large companies such as Karbochem, Bayer, African Amines and SA Calcium Carbide also operate in the area. ArcelorMittal SA turned a profit in 2018 for the first time since 2010, based on increased demand from other parts of Africa. To take advantage of the existing strengths of cities and districts in the province, a network of Industrial Economic Hubs (IEHs) is being developed in KwaZulu-Natal. Leading the process is the Department of Economic Development, Tourism & Environmental Affairs (DEDTEA). A Halaal Manufacturing Park is being considered by DEDTEA, finance institution Ithala, the South African National Halaal Authority and business leaders. Hulamin is a leader in aluminium finished products. The company makes rolled products at Edendale, Pietermaritzburg and Camps Drift while its Pietermaritzburg facility for making extrusions is one of the three in the country. The group headquarters of Africa’s biggest pharmaceutical manufacturer, Aspen, are in La Lucia Ridge. German chemicals group Lanxess has built a carbon dioxide concentration unit at its existing plant in Newcastle. The company makes tanning raw materials at Merebank in Durban and rubber chemicals in Isithebe north of Durban. AECI has a big presence in the province under the Chemical Services

ONLINE RESOURCES

Aluminium Federation of South Africa: www.afsa.org.za Chemical and Allied Industries’ Association: www.caia.co.za Enterprise iLembe: www.enterpriseilembe.org.za Manufacturing Circle: www. manufacturingcircle.co.za Plastics SA: www.plasticsinfo.co.za

banner. Chemical Initiatives runs an elemental-nutrient sulphur plant in Umbogintwini. SA Paper Chemicals operates a big plant at Isithebe. Protea Chemicals, has a large manufacturing plant at Mobeni. Sappi Saiccor's Umkomaas plant is the biggest producer of specialised cellulose in the world with production edging upwards every year towards full capacity of 800 000 tons per annum. Illovo Sugar manufactures downstream products such as furfural (used in lubrication oil), furfuryl alcohol, diacetyl (a flavouring in margarine) and ethyl alcohol. Kynoch makes fertilizer at plants in Durban and Richards Bay. Foskor's acid division manufactures sulphuric acid, phosphoric acid and granular fertilizer in Richards Bay. ChemSpec makes paint at Canelands. KwaZulu-Natal produces nearly a third of South Africa’s plastic requirements. Nampak has several packaging facilities in the province and MPact’s Pinetown facility specialises in FMCG containers. Macbean Beier Plastics and PCI also operate out of Pinetown. Packaging and paper group Mondi’s Richards Bay mill and its paper plant at Merebank are among the province’s most significant manufacturing sites.