Evraz unit could lay off more than 1,000 workers

July 21, 2015 1:53 PM

The steelmaker said on Monday it had pulled the plug on its South African iron operations, citing a lack of working capital. It said on Tuesday it planned to stop its steel plant.

Employees work at a factory of Dongbei Special Steel Group Co. Ltd. in Dalian, Liaoning province March 16, 2015. REUTERS/China Daily

South Africa's Evraz Steel and Vanadium said on Tuesday it could lay off more than 1,000 workers after temporarily ceasing the production of steel due to depressed prices and competition from Chinese imports.

The unit of Evraz plc, which in April applied for protection from creditors to avoid being liquidated, sent notices to about half of its 2,242 workers saying their jobs could be terminated, trade union Solidarity said in a statement.

The company said the closure of the iron and steel making operations was a temporary measure and production will resume once market conditions improve and the company finds funding for its operations.

Evraz said the domestic demand for its products fell due to a significant increase in imports from China.

The company has will now start a period of 60 days of consultation with trade unions over the proposed job cuts as per South African regulations.