Tanzanian government announces plans to import steel from Zambia

Tanzania plans to import steel from Zambia's newly commissioned 300,000-mt/year plant as the country seeks to capitalize on the reduced costs and steady supply of construction materials associated with importing from its neighbor, Steven Kiruswa, Tanzania's junior minister of minerals said Nov. 12.

According to Kiruswa, Zambia's newly-established steel facility is well-positioned to support key infrastructure development and industrial projects in Tanzania and could also benefit iron ore investors in his country.

The plant, a joint venture of China's PDV Group and Zambia's Nicho Group, was inaugurated on Nov. 8, 2024 and is aimed at strengthening Zambia's industrial sector and supporting the development of the country's iron ore industry.

"Our country's Vision 2030, which aims at accelerating infrastructural development, will benefit greatly from the Zambia's steel industry and we are looking forward to import[ing] a great deal [of] steel products to achieve that," Kiruswa said in a telephonic interview.

Kiruswa said Tanzania will import around 200,000 mt of steel annually from the plant.

He added that there is a need for a united African approach, emphasizing collaboration among African nations to establish manufacturing, processing and refining facilities on the continent to reduce costs of doing business.

Presently, Tanzania's annual expenditure on steel imports average around $1.22 billion, making it the country's second-largest foreign exchange expenditure behind oil, according to the Central Bank of Tanzania.

Tanzania is also partnering with Uganda and international oil companies TotalEnergies and China's CNOOC to build a 1,445 km steel pipeline from oil fields in Hoima in western Uganda to the port of Tanga.

He added that Tanzania is also enabling neighboring countries like Burundi and the Democratic Republic of Congo to process their minerals locally, fostering regional prosperity and maximizing resource benefits, noting that strong partnerships among African nations are key to making the 'Vision 2030' a reality.

He said that the $230-million project is one of the largest steel production facilities in the region and stands ready to supply Tanzanian projects with high-quality steel products. Coupled with competitive prices, it could be a game changer not only for Zambia and Tanzania's steel industry but for the entire region, he said.

Tanzania's mining, transportation, and construction sectors are expected to benefit from this increased steel supply in Zambia and also help stabilize supply chains, and reduce dependence on imports from Asia.

Tanzania also operates the Liganga Iron and Steel project, which has an estimated 1 billion mt of iron ore reserves. The projects is a joint venture between the Tanzanian government and Sichuan Hongda Group of China. The project includes an iron ore mine, steel mill, and other infrastructure, and is expected to produce 1 million mt of iron and steel products annually.

Platts, part of S&P Global Commodity Insights, assessed the 62% Fe Iron Ore Index at $101.15/dry mt CFR North China Nov. 11, down $1.65/mt from Nov. 8.