Nigeria's Steel Rolling Mills Run at 30% Capacity Due to Tight Cash, Less Construction

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Nigeria imports about 17 million tonnes of steel per year. It has produced 2.5 million to 3 million tonnes per year domestically in past years. Abdullahi Also, director of steel and non-ferrous metals in the country's Ministry of Mines and Steel Development, said Nigeria had more than 30 privately owned rolling mills with a range of capacities, but only 15 were producing iron rods, while others had power or gas challenges. The privately owned mills are located mostly around the Lagos-Ogun axis, including Katsina, Kano, Kaduna and Ilorin.

"We have been discussing with the operators, but because of the downturn in the economy, most of them are producing at a very low capacity of around 20% to 30%," he said.

The companies are complaining of cash flow problems as the construction and building industries have slowed, but remain hopeful of an uptick during 2015.

"So, this is the general trend," Also said. "The production level has dropped because of the grounded economy situation in the country. That is the general feeling we are hearing from the operators."

For related information, see January 9, 2015, article - Falling Oil Prices, Lower Exports, Rise of U.S. Condensate Shipments Pose Triple Whammy for Nigeria.

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