Mittal to build steel plant in Africa. ArcelorMittal, the world's biggest steel company, is to build a Dollars 90m steel plant in Mozambique as part of plans to gain a stronger foothold in Africa and increase its capability to secure supplies of raw materials. As part of the project to build a plant capable of making 400,000 tonnes of steel a year, the Luxembourg-based company has also signed an agreement with the government of Mozambique under which it will look at the possibilities of operating new ventures in the country in mining iron ore and coal - important raw materials for steelmaking. In two other deals, ArcelorMittal said it was stepping up efforts to secure supplies of manganese and molybdenum, metals used in small quantities in steel alloys. Part of these efforts relates to the company taking a Dollars 70m stake in General Moly, a US minerals company that mines molybdenum in Nevada. All three moves are linked to the ambitions of Lakshmi Mittal, ArcelorMittal's chief executive and main owner, to make the company a force not just in steelmaking but in the supply of the raw materials used in the industry. With the prices of many of these materials having increased strongly in recent years, Mr Mittal thinks most steel companies will need to set up their own internal production processes for these commodities if they are to maintain the industry's good recent run of profits growth. In its plans for Mozambique, ArcelorMittal did not disclose how much its new rolling mill - due to be built by late 2009 and employing about 250 - would cost. However, this is thought likely to be about Dollars 90m. The mill is likely to receive raw - or unprocessed - steel from other plants outside Mozambique and do the final rolling to make bars, used in construction and in various areas of manufacturing. The new plant will add to ArcelorMittal's presence in Africa, where it has steel plants in South Africa and Algeria, and is opening up an iron ore mine in Liberia. Malay Mukherjee, a senior ArcelorMittal executive, said Mozambique could "prove to be a strategic location" for ArcelorMittal in the continent. In its moves in the area of manganese, ArcelorMittal said it was starting a joint venture with Kalagadi Manganese, a South African metals company, to develop a manganese mine in Northern Cape province and a metals smelter in Coega. In its links with General Moly, ArcelorMittal is taking a 12.6 per cent equity stake in the US company, becoming its second-biggest shareholder, in return for receiving guaranteed supplies of the metal. (c) 2007 The Financial Times Limited.
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