Stainless Steel Magazine May 2012

R29.95

Second Quarter, 2012

A leading supplier of corrosion resistant materialsprofi

le

turns 60

inside Is enough being done to protect SA from unfair imports?

Sassda launchesStainless Steel Awards

CONTENTSsecond quarter, 2012

Second Quarter, 2012 1

REGULARS

ADVE

RTS

PROFILES

FOCUS ON

3 Perspective A message from the new executive director, Bill Scurr24 Import Sector Gary Crawford examines the difficulty of decision making26 Technical News Minteks Deon Slabbert explores success through failures28 Industry News News and events from companies in the industry31 Sassda News News and events from the association32 Personality Profile We talk candidly to executive director Bill Scurr

16 NDE turns 60 The stockist and distributor believes its success ts linked to being a truly South African company

Air Products BohlerCronimetColumbus StainlessGeneral Profiling IDCMacsteel VRNRimex MetalsStalcor

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10

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Imports Is enough being done to protect

South African manufacturers from unfair imports

Duties Imposed on Sinks Frankes application to Itac to have duties raised

on sinks has been approved by government

Anderson Engineering The engineering company has completed a large

scale project with the SA blood bank

100 Years of Stainless Steel This year we celebrate a century of innovation,

read the real story behind the invention of the alloy

Stainless Steel Awards Sassda has launched its prestigious awards and

is calling for entries from all over the country

Air Products The gas company explores the high cost

of doing business in South Africa

This magazine is printed on Sappi Triple Green paper

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pErSpECTivEsecond quarter, 2012


CONTACT USPublisher Maverick Marketing

Editor Melissa Rowlston Tel: 011 483 0941 [email protected]

Photographs Werner Prinsloo Getty Images

Contributors Tom Robbins [email protected]

Printers Goldfields Press Tel: 011 627 7740 Fax: 011 627 7741

Letters, comments and subscription requests to [email protected]

SASSDATel: 011 883 0119 Fax: 011 883 0183

e-mail: [email protected]

Stainless Steel is published quarterly and is distributed to stockists, distributors, fabricators, specifiers, consulting engineers, architects, mining, petrochemical and chemical industries, food

beverage and pharmaceutical industries, consumer outlets, end-users, educational institutes and provincial and government departments. Maverick Marketing makes every effort to ensure the accuracy of the contents of its publications, but no warranty is made as to such accuracy, and no responsibility will be borne by the publisher or Sassda for the consequences of any actions

based on information so published. All opinions, views and expressions contained in this publication

are not necessarily those of the management of Sassda. The contents of this publication enjoy positive protection under the Copyright Act and therefore copyright thereof is expressly reserved. Any copying,publication and distribution of part or

whole of the publication is prohibited unless consent is granted by Sassda.

Nearing the end of only my second month as the executive director of Sassda, but having been out of the stainless steel industry for nearly 18 years, I am beginning to get a feel for the challenges facing the industry, as well as the purpose and requirements of Sassda as an organisation.

I am excited to have taken on the position of Sassda executive director and I hope to work closely with the members of the association. Sassda has recently adopted a Back to Basics approach and as such needs to refocus on making

sure that Sassda is adding value to the associations members and supporting their business objectives in the appropriate way. I look forward to addressing the challenges facing the industry and taking advantage of the opportunities open to it.

Based on my experience at my previous employer, a multi-faceted manufacturing business, my preliminary impression of the stainless steel industry is that it faces the same challenges faced by many manufacturing businesses in South Africa. unfair imports are of particular concern (read the lead article on page 4 for more). Issues such as labour legislation, input cost increases and exchange rates also have to be managed, although Sassda may not be the correct vehicle to address such issues (on its own anyway). Other challenges, such as skills shortages, are also not unique to the stainless steel industry, but here Sassda can play a role. We hope to use the Stainless Steel magazine as a vehicle to explore the issues facing the industry and your input is always valued.

Sassda is pleased to announce that its bi-annual Buyers Guide has been reinstituted, updated, printed and is currently in the process of being delivered to members, as well as to users and specifiers of stainless steel. We are also holding the highly regarded Stainless Steel Awards again this year (go to page 18 for more information and how to enter) after a hiatus of four years. We call on all readers to enter and participate in these international accolades; it really is a time to celebrate what the stainless steel industry has done and is still doing.

Going forward, issues such as education and skills training are high on Sassdas agenda and we encourage all readers and members to engage with Sassda and the magazine. Please contact Sassdas offices if you have any particular queries or comments.

Bill ScurrExecutive Director

Sassda

The rise of imports raises questions about South Africas protectionist policies

focus onimpOrTS


Statistics on the stainless steel industry show a steady rise of official primary imports in 2011 compared with 2010, but what is unknown is the extent of unrecorded imports.

Over the second half of 2011 official imports gathered pace, even as the rand weakened relative to most emerging markets. More marked was the official drop in finished exports over the same period.

The local stainless steel industry is rife with both industry allegations and anecdotal stories of unrecorded unfair imports hurting factories ranging from the downright illicit to legal duty avoidance schemes. This is much in the same way as some individuals illegally dodge paying tax while others hire experts to legally avoid doing so.

Earlier this year the Stainless Steel magazine reported domestic makers of stainless steel and aluminium kitchenware had requested further government protection from the predatory pricing by Far Eastern imports after the closure of eight local manufacturers since 2004.

For obvious reasons the extent of unrecorded imports is as difficult to compile as the trade in the industry of smuggled cigarettes. Nevertheless, the cash-flush tobacco industry spends significant resources researching this, lobbying government and even offering a free phone service published on cigarette boxes to verify the tobacco is not illicit (consumers have to sms manufacturers and are then called back).

While official finished product imports were only up marginally from 13 141 tons to 13 898 tons in 2011, according to the South African Iron and Steel Institute (close to triple the import of 5 000 tons in 2004) there was a far steeper rise in primary, or semi-finished imports, such as tubular products, which increased 13.8 percent to 47 630 tons. Tubular products and flat products are the most affected by imports. Of concern was that the increase in total stainless steel imports gathered steam and was stronger in the second half of the year.

More alarming for those local manufacturers of semi-finished goods that sell abroad was the 20.6 percent fall in primary exports to 250 719 tons.

The rise in imports comes at a time when the government has embarked on a policy to increase local procurement by regulating minimum local content in select categories for use by departments and state-owned enterprises. It remains to be seen to what extent this commitment will be translated into more effective policing of selected stainless steel categories such as rolling stock and buses.

Stainless Steel importscome under scrutiny

The import of semi-finished products rose 13.8 percent during 2011, while the IMPORT of finished product slowed

to an increase of just 13 898 from 13 141 tons in 2010

The increase in imports also raises questions for the stainless steel industry.

Should it boost its professional lobbying capacity? Is it viable to establish commercial trade monitoring and investigative capability? The question is to what extent is it worthwhile committing time, experienced personnel and funds to building the forensic capacity to investigate unrecorded trade?

This commitment would include enhancing trade expertise to investigate dumping of product, or predatory pricing where manufacturers export a product to another country at a price below the price charged in its home market. It could also literally mean hiring private detection services to assist customs in investigating illicit imports declared under categories that do not carry duties, and those imports that are legally exempted from duties by authorities because they are in the national interest.

Another area is researching foreign state subsidies such as cheap state loans, all the while remaining informed of the same situation in this country.

Moreover, is this even a legal and criminal and political battle that can be won by local manufacturers or should they rather seek to simply contain the situation? This would free it up to put most of its energy into a manufacturing area where it has more control improving its own efficiency and competitiveness. Of course it has no control over the level of the currency, which continues to be volatile, and only limited influence over labour productivity.

What is known is that the government, which announced the local procurement policy last year, is officially at a senior level receptive to methods to boost domestic production. Local procurement is also one of the few areas where the influential labour movement and factory bosses are in agreement.

Boosting joint business-labour lobbying may be the cheapest and least complex approach to ensuring this local procurement commitment is carried out by officials on the ground. A united one-issue campaign will have

6 Second Quarter, 2012

focus onimpOrTS

Stainless protectionism crisscrosses from East to West

With local imports of flat and tubular primary stainless products rising, South Africa is hardly alone in dealing with the threat of cheap imports.

In May the protectionist Argentinian government placed import duties on some stainless flat products from 12 Asian countries. Late last year India placed anti-dumping duty on imports of hot-rolled flat products of stainless steel from South Africa and Europe, illustrating that protectionism is hardly one-way traffic between Asia and more developed countries.

Even in the Far East, Taiwanese stainless steel mills are mulling over filing an anti-dumping claim. These moves come in addition to the increase in South Africa on the import duty of stainless sinks earlier this year (see page 10).

South African Imports of flat primary products rose 28.4 percent to 21 373 tons in 2011 and tubular primary products were up 20.8 percent to 10 115 tons, according to the South African Iron and Steel Institute.

Despite the threats posed by imports to domestic industries across the globe, in general the world has resisted implementing the widespread protectionism that followed the 1929 depression. While economists and governments may be divided on how to pull the global economy out of a downturn, there is common view that the protectionism in last centurys crisis only extended, and globalised, the depression by seizing up trade.

European calls to protect industries and jobs may become stronger if the Greek and Spanish debt crisis explodes across the entire continent, cutting stainless steel demand in the worlds most established economic region.

While overall South African primary imports increased in 2011, foreign sales fell by more, illustrating the vulnerability of exports. Total primary imports were up by 13.8 percent in to 47 6,30 tons and exports dropped by as much as 20.6 percent to 250 719 tons. Domestic manufacturers have complained that authorities have not done enough to protect South African exports. But the states International Trade Administration Commission has to tread a careful path to avoid the retaliatory protectionism that can potentially spiral out of control as it did in the 1930s.

Recently announced minimum local procurement regulations for government departments and state-owned enterprises, and the manufacturing competitiveness enhancement programme (MCEP), while still limited, are all forms of state subsidies. Nevertheless they will make it harder for local manufacturers to complain that foreign rivals are the only companies to be subsidised by authorities.

significant clout with the government, given the trade union movements influence over the government.

The backdrop is that since the ANC came to power the South African governments approach has placed greater emphasis on free trade than protectionism. But the state agency International Trade Administration Commission (Itac) is open to being convinced to institute higher import duties and even anti-dumping rulings if a strong and thorough case can be made. Recent examples are the increase in import duties on stainless steel sinks (see page 10 for the full article) and an interim anti-dumping ruling on non-stainless steel screws imported from China. These screws will now attract a hefty 104.5 percent duty.

In general local production remains relatively healthy with both domestic primary production and converting rising even as imports increase. This, coupled with the fact that local production is still higher than imports, suggests that in many categories South African production expertise and capacity has not yet been lost.

A source involved in monitoring imports says from his experience in a related industry much of the import duty avoidance is legitimately done. Local and foreign investors and even sometimes state-owned enterprises are able to get exemption for duties, the source says. This is done by successfully applying to reclassify products under borrowed codes that do not carry duties.

The problem is much of this product could and should be made in South Africa, he says.

The source says one of the problems with this reclassification approach is that details of imports are not accurately reflected in customs and excise statistics, which fall under the South African Revenue Service (Sars). This information vacuum and the fact that what is public information is only made available months after the fact, makes it difficult to engage authorities as to whether imports are unfair or not.

You wont know unless you stumble upon the goods, he says of detecting exempted or illicit imports.

The source says it is also legally difficult for Sars to publish more comprehensive details about imports due to legislation that governs privacy. This is related to confidentiality that also protects taxpayers revenue details.

The only information published

about imports is the country of origin, tonnage and value. Sars is not in a position to divulge the detail of what the product is, for whom it is intended and where it is going. This makes investigation extremely difficult, he says. But the source says of late Sars has agreed to conduct investigations when tonnages in categories that are historically low suddenly surge to unrealistically high levels. Previously they would only investigate false declarations on the basis of claims that appear to be substantiated against specific importers.

Of course the practice of legitimate duty avoidance, as well as

downright illegality, might differ in the stainless steel sector, but the example nonetheless illustrates the complexity of the issue, including the legal perspective. Customs stretched investigative capacity would similarly affect the stainless steel sector. Furthermore the advantages of trade confidentiality may have an unintended downside here too.

Sars was asked if duty exemptions, where other import category codes were borrowed, was a legal loophole being exploited by traders but couldnt be reached by phone and didnt return email.

But potentially there are ways to

An interim anti-dumping ruling has been placed on non-stainless steel screws imported from China



Manufacturers to get R5.75bn injection

The manufacturing sector is to get a R5.75 billion injection over six years from the Department of Trade and Industry to help factories become more competitive in the increasingly difficult global economic environment.

Speaking at the launch of the Manufacturing Competitiveness Enhancement Programme in Cape Town on Tuesday, 15 May 2012, Trade and Industry Minister Rob Davies said the world was going through the second wave of the great recession brought on by the global financial crisis of 2008, with manufacturing coming under particular pressure.

Davies said the sector had been struggling with increasing input costs as well as the monetary policy response of advanced countries -- where very low interest rates in developed countries had led to money flooding into emerging countries where interest rates were higher and had therefore pushed up currencies such as the rand and made exports uncompetitive.

Last year, the manufacturing sector contributed 14.6% to GDP, compared to 21% in 1977, while in fast-growing Asian countries the sector had been growing -- in Korea from 23.6% in 1977 to 30.6% in 2010 and in Malaysia from 19% to 26.1% over the same period.

If South Africa wanted to become a leader in Africa, it also had to raise competitiveness, Davies said, adding that those manufacturers that did not boost their competitiveness around the onset of the global financial crisis were the ones that were hit particularly hard.

He said the new programme would complement the Industrial Policy Action Plan (IPAP) 2012/13 to 2014/15 which was launched in April.

Of the R5.75 billion available to manufacturing firms over the next six years, R1.25 billion had been allocated to the programme this financial year.

The programme, which would borrow on lessons from the successful Clothing and Textile Competitiveness Improvement Programme, includes six incentive grants.

These will help improve firms competitiveness in capital investment, green technology and resource efficiency improvement, enterprise-level competitiveness improvement, cluster competitiveness improvement and funding for feasibility studies.

The programme would be complemented by a loan facility by the Industrial Development Corporation (IDC).

Firms that apply for support from

boost manufacturing across all sectors. Many involve risks, have potential downsides and will be opposed by threatened interest groups, including public sector unions.

Pan-African Investment and Research Services economist Iraj Abedian highlights the biggest constraints to South African business as compiled by the World Economic Forum (WEF) global competitiveness report. In order of declining severity, the top four are inefficient government bureaucracy; inadequately educated workforce; crime and theft; and restrictive labour regulations. Of these only freeing up the labour market can be achieved in the short-term and even this is politically difficult to attain.

Abedian argues for a targeted re-industrialisation policy that piggybacks off existing industries rather than moving into new sectors. Nonetheless, he controversially says that these require more state intervention in the economy or a heavy mix of political and technical inputs. But unlike the ANC he stresses the professionalisation and de-politicisation of the key technocratic layer of the public sector and its state owned enterprises [SOEs] as well as state agencies.

These include expanding the supply of mining equipment and services; and the long talked about beneficiation of local raw materials. But all these measures have potential negatives such as eating up scarce financial resources or possibly making industry even less competitive, as can happen with import protection.

The other change Abedian stresses is, domestically at least, far easier to achieve. This is better integration into sub-Saharan Africas growing and increasingly urbanised market. Improving customs efficiency is relatively easy and cheap to achieve. No doubt road and railways are expensive but more finance is being enthusiastically offered for African infrastructure than in recent memory. Of course establishing a common market may be difficult to achieve in terms of regional politics.

Thankfully last years rise in stainless steel imports, coupled with the more dramatic fall in exports, was saved by the local market, which grew 13.6 percent. But if the trend of local production continues to shrink, local

focus onimpOrTS factories could become extremely vulnerable were local and global

demand to collapse for even just a year. The threat of Europe pulling the world back into a global recession haunts the local stainless steel sector. The decline of the stainless steel slice of manufacturing relative to the rest of the economy mirrors the overall fall in all manufacturing as a contributor to gross domestic product.

Far more worrying than the expected loss in production competitiveness against other low-cost manufacturing countries has been the increase in competitiveness of even the most expensive, or developed countries, data from Abedian shows. South African factories face not only headwinds from the Far East but increasingly also pressure from clever manufacturers in Europe, Japan and the US.

Iraj Abedian

Second Quarter 2012 9

the programme are required not to reduce employment during the duration of their participation in the programme.

Applicants had to be at level 4 on the BEE scorecard, or have a credible plan on how they plan to do so within the next four years.

Davies thanked industry roleplayers, particularly the Manufacturing Circle, for its contributions in compiling the programme and said he was pleased that the organisation had become a much more prominent organisation among those in the manufacturing sector.

Detailing the workings of the programme, Tumelo Chipfupa, Deputy Director General of The Enterprise Organisation, said incentives would be calculated according to manufacturing value added and given credits -- smaller firms, as well as black-owned and managed firms, would be allocated a higher weighting when points were calculated.

Using these credits, an applicant would be able to draw on grant funding across the programmes six incentive grants.

Grants would be based on a cost-sharing principle, with smaller firms being able to allocate a higher percentage of grants to cover funding for their competitiveness-enhancing

projects, than bigger firms.The coverage offered by each of

incentives differs, namely the:Capital Investment Grant to

upgrade capital equipment and expand productive capacity to cover between 30% and 50% of the investment.

Green Technology Upgrading Grant for investment in technology and process that will make the production process greener to cover between 30% and 50% of the investment.

Enterprise-Level Competitiveness Improvement Grant for investment in the adoption of improved manufacturing practices to cover between 50% and 70% of project costs.

Feasibility Studies Grant: A cost-sharing grant towards developing a bankable feasibility study for new manufacturing projects, to cover between 50% and 70% of project costs.

Cluster Initiatives Grant to help fund shared infrastructure such as a sector technology development centre, market research, international advertising and publicity costs, with the grant to cover 80% of qualifying project costs.

Grant funding for cluster initiatives is aimed at encouraging smaller firms to band together to carry out joint marketing or joint buying,

which would help them become more competitive.

The Working Capital facility will include a revolving 180-day, 6% fixed interest rate facility, while the Distressed Fund consists of a concessionary 6% fixed interest rate loan for applicants that are accessing the IDCs Distress Fund.

Because most of the grants are in the form of reimbursements, which are paid out only later, often after a company has spent the money it had requested. Many small businesses that applied for the grant often experienced a cashflow shortage.

To counter this, Chipfupa said the IDC would be able to provide upfront to small enterprises while the grant was being processed.

Double dipping in funding and enterprises that charge import parity pricing would be excluded from the programme, he said.

Chipfupa said the departments current target for addressing applications was 60 days, but he stressed that the Enterprise Organisation was aiming to reduce this to 45 days.

The departments Director General Lionel October said applications will be handed out as of today, and the programme will go live on 1 June.

Trade and industry minister, Rob Davies, says South Africa needs to raise competitiveness


The import duty on stainless steel sinks has been increased from 20% to 30% following an application by Franke Kitchen Systems.

The International Trade Administration Commission (Itac) confirmed on Friday, May 4 2012 that the minister of trade and industry had approved its recommendation to increase tariffs to the maximum rate allowed under World Trade Organisation agreements on tariffs for industrial and agricultural goods.

Franke brought the application saying its domestic market share had declined precipitously since 2008 as sinks continued to be imported at artificially low prices, especially from East Asia, given the reasonable cost of manufacturing, globally, of stainless steel sinks.

The import of sinks increased significantly during 2008 to 2010, according to Itac, as subsequently did the price disadvantage to the domestic market. Frankes market share dropped from 63% in 2008 to 43% in 2010.

The local stainless steel sink manufacturing industry consists of two producers: Franke and PABAR, with approximately 88% and 12% of local production respectively.

Itac said: The backward linkages of the sink industry to the local stainless steel industry are also an important factor.

Itac said the additional tariff support for local stainless steel sink manufacturers would improve their price-competitive position in the industry in the face of abnormally low price competition from abroad.

The support should enable the domestic industry to fully utilise its existing production capacity and achieve increased economies of scale with a reduction in the marginal

cost of production, said Itacs chief commissioner Siyabulela Tsengiwe.

Franke employs 242 people and has invested about R84 million. Itac said it would monitor the performance of the industry in particular with respect to production and employment.

Tariff support is considered on a case-by-case basis for industries that experience threatening import competition and is tied to conditions relating to economic performance over time, in particular, production, investment

and employment, said Tsengiwe. Since 2008, Itac has

recommended tariff increases for products such as clothing and apparel, towers and lattice masts for telegraph and electric power lines, certain chemical products, water supply meters, and certain canned food products.

The tariff increase relates to ordinary customs duties and does not have a specific life span. It is not an anti-dumping measure that would have to be reviewed every five years, he added.

Duties raised onstainless steel sink imports

Trade and industry minister approves the International Trade Administration Commissions recommendation to increase duties on stainless steel SINK IMPORTS to help

South Africas price competitiveness

Anderson upgradesblood bank facilities

Preliminary discussions between Anderson Engineering and the National Bioproducts Institute (NBI) with respect to the blood plasma fractionation project began around 2007. However, the project started gaining momentum only after the needs analysis and several revisions of the scope of work, in 2010.

Blood plasma fractionation entails the general processes of separating the various components of blood plasma to manufacture pharmaceutical products, such as human albumin solutions, human immunoglobulin (antibody) preparations, and human coagulation (clotting) factor proteins. The processing method requires the absolute control of four critical parameters, namely alcohol concentration, temperature, pH and ionic strength to extract and purify therapeutic proteins in plasma. Plasma fractionation with ethanol is still the most widely used plasma protein production process internationally.

Based on their capacity and compliance requirements, NBI made a decision to upgrade their fractionation facility with the assistance of Anderson Engineering. Managing member Hans Coertse commented, This is the biggest turnkey project that Anderson Engineering has ever undertaken. It was a project that pushed many of our

boundaries; it was an exciting project, one that we enjoyed immensely.

There were significant physical constraints, and the equipment had to be designed accordingly. The plant installed comprised:CIP equipment: specifically designed to fit into one of the smaller areas within the facility. Main Process Room containing the four 6 500 litre fractionation vessels, a 2 000 litre dissolution vessel, the buffer dispensing system and the control panels (accessed through an upper level platform). Control Room, separated from the main process room by a glass viewing window. Glycol Chilling Plant (5 000 litres) and utilities installed on the level above the process room, as these will function under the normal ventilation conditions in that area.

Some noteworthy aspects were:The equipment was designed to cope with temperatures ranging from -30C to 122C. The surface area of mirror polishing required on the vessel internal surfaces was 158 square metres. 1.38 kilometres of stainless steel processing pipes were usedA further 1.5 kilometres of pneumatic

pipes, which connect to 250 pneumatic valves, for controlling the field process valves were installed900 cables, with a total length of 18 kilometres were installed This project marked Andersons first complete adherence to the GAMP control and documentation system. (They had previously worked extensively with Aspen on the documentation aspect and brought this experience to bear in this project.) Stainless steel and granite were used in the control area to achieve the hygiene levels required. Air conditioning, refrigeration, electrical and control systems specialists were contracted to complement the skill set of the Anderson team, and they worked synergistically with them to achieve the desired end.

David Stubbings, CEO of NBI commented, Anderson was the best positioned to deliver on our requirements. We took into account the quality of their workmanship, their experience in the pharmaceutical and food industries, as well as the references they received. It has been a pleasure working with Hans and the Anderson team.

Anderson Engineerings core business is the design and manufacture of stainless steel processing equipment.

Main Process Room showing the fractionation, dissolution vessels, the dispensing system and the control panels

Second Quarter 2012 11


As with any great story, the invention and history of stainless steel is not only one of controversy and intrigue, but also an inspiring story of how a product changed the world in less than a century.

Although there is some debate as to who invented stainless steel, the fact is that an acid resistant alloy was first patented in Germany 100 years ago by Krupp engineers, Eduard Maurer and Benno Strauss. This alloy was the basis for the development of austenitic stainless steels, the most popular group of stainless steels in use today. However, it was not until the next year, 1913, that Harry Brearley first commercialised stainless steel.

At the time, Brearley was the manager of the Brown Firth Research Laboratory in Sheffield, England. He had been tasked with improving the erosion resistance of gun barrels. He decided to add an unprecedented amount of chromium, about 12%, to iron. He then noticed that this steel would not etch with acid and, furthermore, when the gun barrels made from this new steel were stored outside, they did not rust. The result was the first martensitic stainless steel.

Harry Brearley immediately recognised the commercial significance of this new steel. As luck would have it, the town of Sheffield was famous for cutlery manufacture and it wasnt long before the first rust-free knife blades were produced. Unfortunately the directors of the company refused to patent this rust-free steel as they did not see the advantage of rust free knife blades. After all, the knives still had to be washed. Brearley thus resigned and filed his own patents in North America in 1915.

However, Elwood Haynes had also independently invented 12%

chromium rust-free steel in the USA, but his application for a patent was turned down because of Brearleys patent, even though Haynes filed his patent first. In the end, the dispute was resolved

by Haynes and Brearley setting up a company together, called the American Stainless Steel Company, whose vision was to promote the knowledge and use of stainless steel worldwide.

Stainless Steel -- a century of innovation

The history of stainless steel is mired in controversy and intrigue, but 100 yEARS later it is truly one of the most useful inventions

in all spheres of architecture, engineering and design

Architectural splendour Whereas the Chrysler building was once the iconic stainless steel building, it is now prolifically used in design and architecture, such as in the Bean (pictured above) in Chicago


Certainly, in the early years, the USA certainly took the lead in developing new applications for stainless steels.

It wasnt until 1920 that Krupp announced their 1912 patent of austenitic stainless steels to the world. The ferritics stainless steels had meanwhile been developed and the duplex stainless steels, combining the best of the austenitics with the ferritics, were first developed in the 1930s. However, it was not until improved steelmaking techniques became available in the 1960s, that the duplex and ferritic stainless steels could be produced in a cost efficient manner with the desired low carbon contents. Several years later, in 1977, the utility ferritic stainless steels were invented in South Africa by Columbus Stainless. The most well-known of these steels is 3CR12. These steels combine the low cost of the ferritic stainless steels with the toughness and weldability of the austenitic stainless steels.

Stainless steels are a relatively new material and the product development seen in the last 100

years has been impressive. But the successful market development and commercialisation of a new product is often more difficult. The first successful stainless steel application was knife blades in 1913 but other notable applications were the appearance of the first stainless steel roof in America in 1924 and the first stainless steel beer

brewing vessel in 1928. The largest single application of stainless steel in this period was the roof of the famous New York landmark, the Chrysler building, which was completed in 1930. Other stainless steel firsts were in railway carriages in 1931, sinks in 1933, automobiles in 1936, underwater TV cameras in 1954, razor blades in 1963 and in 1969 the Saturn V rocket for Apollo 11 contained stainless steel.

Today, stainless steel is everywhere. The applications are diverse and new applications are constantly being developed. Stainless steel is not just stainless, it is also hygienic, strong, tough and fully recyclable for a greener future. It now plays a part in all of our lives, and has truly changed the world. Stainless steels are now the fastest growing segment of the metals industry.

Columbus Stainless is proud of their contribution to the history and development of stainless steels and look forward to their future role in adding stainless quality to life.

-- By John Tarboton

Harry Brearley


companyprOFiLE


NDE, one of the largest privately owned stockist and distributors of stainless steel base beneficiated products, turns 60 this year.The company was registered in 1952, says

NDEs majority shareholder and managing director Mike Campbell, so officially we turn 60 this year, however, it is more like 65.

The company has over the years mastered a product range in response to their customers needs, drawing supplies from local and international manufacturers and converters. NDEs success lies in the fact that it offers choice, says Campbell. The importer has been the first to bring many new products to market, and director Hardy Esterhuizen says the company is proud to have been fast to bring exciting new grades and offerings to their customers.

Its about providing the market with alternatives, says Campbell. Alternative sources of supply as well as alternative products.

NDE is an example of extraordinary success as a South African business, not only as a stainless steel business. The company has survived the change of ownership, shareholders and the total re-invention of its core business. It is the culture of the business that has seen it through, says Campbell, who gives every employee a set of the companys guiding principles to follow.

The full history of the company is rather sketchy. It was conceptualised in a European Prisoner of War camp at the end of the 1940s. Its founders returned to South Africa and started a dairy supplies company called National Dairy Equipment, or NDE. In the 1970s the use of stainless steel in the food industry became more prolific and NDE became more focussed in this area.

In the mid 1970s the company changed hands to Dr Pincus Snideman, however, Snideman was not an active participant in the everyday running of the company. Snideman also acquired Falcon Engineering at the same time and brought it into the NDE fold.

In 1984, Mike Campbell joined the company and a year later took over as managing director from his predecessor, Chris Nesbit. Campbells primary

role was to structure the business. There were lots of skills in the business, says Campbell. However, the commercial side needed sorting out.

By 1989, NDE was structured into: NDE Project Engineering; NDE Process Flow Equipment; Falcon Engineering; and NDE Stainless Steel.

The political backdrop is crucial to NDEs development as a South African business as the company is and always has been primarily an importer. In 1986, sanctions started to bite, says Campbell. We needed to figure out a way to survive. The company was now heavily embedded in the food culture and many of its products and equipment were being brought in from Europe and Scandinavia in particular.

At the same time the company also hit another hurdle; its primary agency the manufacturer that NDE had represented locally for 35 years was bought by its competition in Europe. All the equipment that was sitting in the marketplace was gone overnight, says Campbell. The company struggled and was able to replace agencies and recover, however, it was a blow, says Campbell.

As the South African political situation got hotter, so did the exchange rate. When I took over in 1984, the rand was worth about R1 to U$0.89, says Campbell.

The rand was worth $1.40 at its inception in 1961 until about 1982 when it broke parity with the dollar as sanctions started to erode its value. Depreciation gained momentum in 1984, fuelled by then President PW Bothas Rubicon speech in August 1985, falling to just around U$0.40

In the 1990s the uncertainty about the country hastened the depreciation to around R3 to the dollar and then R3.60 after the first democratic election in the country. In 1999, the inauguration of President Thabo Mbeki and appointment of Tito Mboweni as governor of the Reserve Bank saw it slide to over R6 to the dollar. Then in December 2001 it hit its historical low of R13.84 to the dollar, following the September 11 attacks on the US and controversial land reform programs in Zimbabwe. At the end of 2002, the rand was back up at R9 to the dollar.

Celebrating 60 years

of NDE

The success of NDE, one of the largest stockists and distributors of semi finished stainless steel products, lies in its ability to

provide AlTERNATIvES to the market

In 2004 it recovered to R5.70 and then R6.35 in 2005. Its subsequent fluctuations due to a range of economic factors including soaring inflation and power supply concerns has seen the currency stabilise in recent times. However in the recent past it has fluctuated once again and is currently sitting around R8.20 to the dollar.

In 1990, Snideman died and left the business to his son in law, Trevor Fogel. In about 1992, NDE sold Falcon Engineering. The structure strengthened and the divisions were developed into identifiable divisions in the market.

Then in 1999, Fogel left the country to live with his children abroad. With the economic turmoil of the times, Campbell was made an offer he could not refuse and took ownership of the company.

Process Equipment and Engineering were then bought out by a German group of investors, to form what is today Guth. This was a situation that was suitable for everyone involved, says Campbell.

Management were happy and it gave Campbell the funds for NDE Stainless Steel. Investors from the company bought shares in NDE Stainless Steel in 2000, and the company has developed since then into what it is today.

Other shareholders include

Andries Schreuder, Hardy Esterhuizen, Llewellyn Dollman and Logan Moodley.

I believe it is the culture of the business that has seen us through the

changes and turmoil, says Campbell. And the company certainly prides itself on moving with the times, encouraging change and going with the flow.

companyprOFiLE

1948 1950 1952 1954 1956 1958 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980

Policy of Apartheid adopted

SA declared a republic

Nelson Mandela imprisoned

Nationwide riots

Rand introduced

1948 NDE conceived

1952National Dairy Equipment

Registered

1970sDr Pincus Snideman takes

reins at NDE

What it means to be an importer in South Africa

An importer in South Africa needs to make the assumption that the authorities are on top of their game. That they are capable of administrating the system they create and that the duties and legislations provide protection, says NDEs Mike Campbell.

You also need to believe that the companies that supply into South Africa are working off the same economic principles, says Campbell. As soon as you are dealing with countries that subsidise their products you enter the world of unfair competition. South Africa, despite being a signatory to the WTO trade agreements, faces a very difficult situation.

Campbell also believes we, as South Africans, are naive to the problems of imports. On one hand we need to bring down the costs of living, and cheap imports help do this, but on the other hand we need to create jobs, and imports prevent this from happening, says Campbell.

However, despite the ambiguities of trading under these restrictions Campbell understands the necessity of importation in this country. Importation is part of the development of a country. It stimulates demand. When there is a critical mass of products and a market to buy them, then it becomes feasible to do this, until then you need imports, he says. Many of the products NDE supplies are not made in this country. It must also be noted that imports keep prices international, says Campbell.

The nature of the rand also plays an important role. Quick movements in short time are difficult to manage, says Campbell.

In the long term the exchange rate is much easier to manage. The free floating exchange rate also protects the economy. Attempts to influence the currency damage the economy, he says. The reality of the free-floating situation means prices become internationalised and keeps the economy balanced and global.

South Africa was subjected to sanctions in the 1980s, after first being mooted by the UN in 1964 as a measure to try and persuade the country to end

Apartheid, which ran from 1948 to 1994

The rand was introduced on 14 February 1961 to replace

the South African pound as legal tender, at the rate of R2 to 1 pound

or 10 shillings to the rand

National Dairy Equipments first

incarnation was as a supplier of equipment to

the food industry

End of World War II

On June 16 1976, the Soweto Uprising added to the instability of the country, when about 176 people were killed when police shot at students

protesting


NDE The history of a S


turns 60 outh African company

R1.30/$

Rand per US dollarSA Imports

SA ExportsR500 000 million

Economic sanctions imposed on SA

SA State of Emergency

Nelson Mandela releasedANC unbanned

US sanctions lifted

UN sanctions lifted

SAs first democratic elections

Robust SA growth

SA power crisis

SA property prices rise by 20% per year

PW Bothas Rubicon speech

2012NDE turns 60

1985Mike Campbell

appointed MD of NDE

Global economic crisis

Mike Campbell (pictured right) has been at NDE for 28 years, but you wouldnt guess that looking at him. He has a wife, two children at university, a poodle, a pig (yes, thats right, a pig) and two cats.

Campbell is a bit of an anomaly in the industry he is an accountant by training. Not a metallurgist or an engineer. And despite calling himself a grey haired, white old man, he is young at heart. He will talk animatedly about saving the environment or twitter or the Facebook Initial public offering (IPO).

He believes the role of grey haired, white old men like himself, is to provide stability for the country until the normal children can take the reins. A feat he believes is beginning to happen as democracy hits its 18th year.

Apartheid created a social aberration that affected every single person in this country. No one walked away scot free.

Campbell has a real talent for looking at the bigger picture. His friends and colleagues will tell you that this ability to see how things fit together is why he is such an astute businessman. And NDE is a testament to this judgement. He has guided the company through difficult economic challenges as well as internal crises. His ability to change means the company has adapted well too.

His collegues and friends describe him as a democratic leader who lets his team drive; he is just the captain at the helm, guiding the way.

Anyone who knows Campbell will also see a real family man. He is a great father, dedicated and devoted and it is very apparent that his kids keep him on his toes. He is always up for a good debate, well read and in touch with all the latest debates and issues.

R13.84/$

R8.31/$

NDEs focus becomes corrosion resistant materials

Mike Campbell: the man at the helm

1999Trevor Fogel sells NDE to

Mike Campbell & shareholders

1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

Sponsored by:

Sassdasouthern africa stainless steel

development association

ENTRIES CLOSE 31 JULY 2012CALLING ALL INNOVATORS

For more information contact Sassda on 011-883-0119 or e-mail [email protected] or go to www.sassda.co.za to enter onlineSecond Quarter, 2012 19

The Southern Africa Stainless Steel Development Association (Sassda) has launched its prestigious Stainless Steel Awards for 2012. We are proud to be hosting the awards again this year, says Sassdas new executive director, Bill Scurr. The revival of the awards, which were last held in 2008, signifies Sassdas commitment to the industry and desire to celebrate achievements and excellence.

The awards are an industry highlight, says Scurr. They aim to recognise and promote excellence, innovation and entrepreneurial development in the stainless steel industry, by profiling innovative thinking and successes from the industry.

This year the awards coincide with the celebration of the development of stainless steel 100 years ago, and what is being called a century of innovation. As such, the awards theme will follow suit.

Sassda has begun calling for entries. We hope to attract entries from all areas of the industry. This really is a time for companies and individuals to shine, says Scurr. Entries are invited from local and international individuals and companies involved in the production, conversion, distribution, use or specification of stainless steel.

The categories are:

Best Stainless Steel Project Sassda is looking for the extensive, innovative and productive use of stainless steel in a commercial, industrial or domestic project, alternatively in an engineering,

Sassda launches

The prestigious event is the associations COMMITMENT to recognising and celebrating success in the industry

Sassdasouthern africa stainless steel

development association

community or urban project. The project should have been in progress in the last 3 years.

Best Stainless Steel Product Sassda is looking for stainless steel products that demonstrate enhanced performance, cost effectiveness, environmental benefits, aesthetic appeal or other attributes, through the use of advanced, imaginative and best practice design and manufacturing concepts.

Best Stainless Steel Services Sassda is looking for the consistent successful application of service excellence in the manufacture, use, or processing of stainless steel.

Innovation Award Sassda is looking for innovation in a design or manufacturing process or technique that uses or is

used for producing stainless steel products, which significantly improve the operational simplicity, maintenance, efficiency, reliability, throughput and consumption of stainless steel.

Achievement Award Sassda will recognise long-serving achievers in the industry. These can be nominated from companies or by individuals. Student Award Sassda is looking for the best overall engineering, design or architectural use of stainless steel by a student incorporating style, functionality, durability, innovation, environmental foresight, quality standards and cost effectiveness. The Stainless Steel Award This accolade goes to the overall winner from all categories, who has done the most for the stainless steel industry.

A panel of esteemed judges

has been invited and have agreed to judge the awards. They are Professor Madeleine du Toit from the University of Pretoria; Tom Steer from Siyakha Architects; Diego Sella a well-known fabrication and design consultant; and Diana Carmichael, the renowned consumerware designer. Additional judges may be invited to join the panel.

The judges offer a wide variety of expertise and will offer a balanced approach to judging the diverse entries, says Scurr. We would like to thank them for participating in this prestigious event and believe they will play a crucial role in selecting the best entries.


The judges will evaluate the entries

according to seven criteria. Entries will need to fulfil the Excellence criterion, where exceptional work, concepts and execution will be evaluated. Entries will need to be Innovative, showing creativity, originality and advancement. They will need to be Sustainable for the business and the environment. Entries must also fulfil the Efficiency

THE SPONSORS

stainless steelAWArDS criterion, whereby specified timelines are achieved and costs are minimised.

Entries must also comply with the Quality criterion, as the product and work done must meet the highest standards. The Impact on the Environment is another criterion the winning entry must fulfil by ensuring its carbon footprint is reduced. The final criterion on which the judges evaluate the entries is Job Creation and employment opportunities created.

We believe the industry needs celebrations such as the Stainless Steel Awards to recognise exceptional work, says Scurr. Without the help

of the sponsors of this event, none of this would be possible. I would like to thank the very generous support from 3M, Afrox, Columbus Stainless, Euro Steel, Fischer SA, Macsteel VRN, NDE, Rimex Metals, Stalcor, the Nickel Institute and the International Chromium Development Association (ICDA).

The Stainless Steel Awards will culminate in a gala awards evening on Thursday, 11 October 2012 at the Theatre on the Track, in Kyalami Johannesburg. The evening will be a celebration of the best in the industry and is certain to be an industry highlight.

Around the world, industries that use abrasives face many different demands but they all share the same needs: to raise quality levels, and reduce cycle times and manufacturing costs.

3M has the answers, with the widest range of abrasive systems, purpose designed for the job, unique technologies, and people who will match them exactly to individual needs. Its a combination that confirms our commitment to our abrasive users - to be the leading providers of finishing solutions that directly benefit our manufacturing customer.

Our unique abrasives produce precision finishes faster and more efficiently than traditional abrasives. A variety of minerals, backings and attachment systems are available in discs, rolls, sheets and belts to suit your finishing or polishing operation.

Afrox is sub-Saharan Africas market leader in gases and welding products. Afrox was founded in 1927, listed on the JSE in 1963, and has prospered by constantly meeting the needs of customers and developing solutions that add value to customers applications. Afrox operates in South Africa and in 10 other African countries and manages operations in five more on behalf of our parent company, The Linde Group, a global gases, engineering and technology company.

Columbus Stainless, founded in 1966, is South Africas and Africas only producer of stainless steel flat products. Youll find our product in everything from a kitchen sink to a quality wristwatch. Because of the boundless potential for stainless steel as a metal for the future, we at Columbus remain dedicated to becoming one of the leading suppliers of stainless steel in our domestic market and the global arena.

Euro Steel are South Africas premier stockist and distributor of stainless steel, special steels, aluminium and other corrosion resisting materials all in almost every commercially available form. The group is predominantly positioned in South Africa but has operations in neighbouring countries, all of which combine to actively service Southern Africa and beyond. Local experience and distribution infrastructure, coupled with our reputation for representing reputable mills and stocking quality products are the foundation for our success.

Fischer are manufacturers of round, square, oval and rectangular longitudinally laser welded stainless steel tubing available in a wide range of grades and gauges. The company also specialises in bending, end forming and other manipulations.

Over the past decades fischer has established themselves as a reputable supplier of premier quality stainless steel tubing. From the start, fischers main focus has been on customer service combined with exceptional product quality. From material selection to processing all the way to external certification of our procedures.

Macsteel VRN is one of eleven business units within the Macsteel Group in Southern Africa and is proud to be a BEE verified company.

Macsteel VRN is in the business of managing the application specific performance steel supply chain. The pre-dominant emphasis is on application specific high strength carbon plate, stainless steel, aluminium, as well as value added processing for these products classes as well as for commodity plate.

Macsteel VRN is ideally positioned to provide speedy, reliable service and support to the mining, earthmoving, sugar, power generation, construction and fabrication industries through highly experienced staff with intimate knowledge of these sectors.

ENTRY FORMName of entrant:

Postal Address:

Street Address: Tel No: Cell No: Email: Summary of Entry:

Name and contact number of customer / client to contact:

ENTRIES CLOSE 31 JULY 2012

Please fax entries to 086 639 4277 or email [email protected]

Rules & Regulations in BriefAll entries will be treated in the strictest confidence.Entry closing date is 31 July 2012.Entries must be in an A4 folder, on CD or via e-mail.Entries must be illustrated with photographs.Entries must be accompanied by a motivation.Additional materials may also be included.Scaled models may be submitted if applicable.Entrants should provide relevant client contacts. Each submission is limited to a single project.The Name of Entrant is responsible for the entry. The judges have the right to reject any submission.Sassda employees and suppliers cannot enter.The judges decision is final.The full rules and regulations can be downloaded from Sassdas website


NDE, a respected player in the South African stainless steel industry, is one of the largest privately owned stockists and distributors.

NDE has mastered a product range in response to customer needs, drawing supplies from local and international manufacturers and converters.

NDE focusses on customer needs with a guarantee of product quality, sensible stock holding, timeous delivery and a fair price.

The Rimex Metals Group has manufactured surface finishes on stainless steel since 1959 and has plants in the UK, USA, Germany, France, Australia and South Africa. It is the only company that manufactures all these finishes under one corporate roof resulting in the highest level of production expertise, appropriate material management and quality control.

Rimexs products are ideal for various applications within the architectural, engineering, machinery, refrigeration, elevator and transit sectors.

The Nickel Institute is a nonprofit organisation that represents the interests of 25 companies that together produce more than 75% of the worlds annual nickel output. The institute promotes the production, use and re-use of nickel in a socially and environmentally responsible manner. The Institute was established in 2004, through the merger of the Nickel Development Institute (NiDI), established in 1984, and the Nickel Producers Environmental Research Association (NiPERA), originally formed in 1980.

The new face of Stalcor has new impetus and a can do will do must do philosophy. It is striving to integrate into becoming one of the largest players in the stainless steel and sluminium markets hence its commitment to the Stainless Steel Awards.

Stalcor is proud to have introduced market firsts, such as the Stalcor Customer Loyalty Trust program and an interactive web-based trading floor where customers can bid on products for immediate delivery.

The International Chromium Development Association (ICDA) is also supporting the awards.

With a membership of 117 companies in 2011 representing 26 countries across 5 continents, ICDA is the authoritative voice of the industry, dealing with chromium in all its forms. Created in 1984 and based in Paris, France, the ICDA is promoting the value and sustainability of chromium and represent the chromium industry worldwide, through communication, forums and R&D projects.

The ICDA is proud to support the Stainless Steel Awards as chrome is the main element that makes steel stainless.


Rising costs, in particular electricity and transport, are exerting pressure on the gas industry, forcing companies to rethink their supply chain strategies.

This is the view of Seelan Gounden (pictured right), General Manager Supply Chain at Air Products South Africa. Environmental pressures, such as tariff increases, have forced us from time to time to change the goal, so, for example, an efficient supply chain may have to make way for business effectiveness.

When product has to be pooled from production sources that are geographically widely spread throughout the supply chain, transport costs increase. It is a matter of having an understanding that supply chain efficiencies may need to be prioritised on occasion, to realise a larger goal, that of business effectiveness, or, put simply, saving money.

This is the approach that Air Products has had to take in the winter months, to cope with increased tariffs.

Sizwe Nkonde, General Manager Packaged Gases adds that product availability will be prioritised to maintain its security of supply promise to customers.

Electrical energy is by far the biggest portion of our production costs, so hikes in Eskom tariffs have a significant impact on our bottom line, necessitating a change of approach to one of flexibility in response to these pressures, he says.

The supply chain should be seen as a network of various entities which interact, rather than a linear chain,

says Gounden. As a network, this body needs to be flexible enough to respond creatively to the environment, which includes changes in power and fuel costs.

According to Gounden, Air Products has increasingly been looking for creative solutions within its production and supply chain in order to meet the challenge of Eskoms proposed hikes in power tariffs.

Such solutions range from using buffer product which has been stored in summer, to switching off equipment, such as compressors, when possible, to minimising operation plant usage.

It necessitates a re-configuration of plant usage, as well as that of auxiliary equipment such as cooling fans in the winter months, Gounden says.

He stresses, however, that managing power usage is also closely

aligned with managing demand in a fluctuating market.

Managing the dynamic interchange between supply and demand not only necessitates better management and flexibility on our part, but also better forecasting skills, in terms of market knowledge, both locally and globally, adds Nkonde.

Another challenge facing the gas industry is the rise in fuel costs, and once again, Air Products is dependent on road transport for its gas distribution.

There are a number of ways in which Air Products meets this challenge, such as analysing and improving a customers on-site inventory storage.

Improved inventory and cost management equate to increased reliability and security of supply, comments Gounden.

In addition, Air Products has made inroads into decreasing fuel consumption through driver training and monitoring of driving behaviour through drive-cams, and the use of route optimisation programmes.

The fleet should ideally be both robust, and fuel-efficient there should be a balance, maintains Gounden.

Furthermore, an increase in labour costs have to be taken into account in any business context but must be mitigated within the supply chain, by alignment of all stakeholders towards a common goal of cost efficiency.

Gounden emphasises the need for customer-centricity, and serving the market.

Rising costs in the gas industry

companyprOFiLE


Decision-making is central to being human, yet so taken for granted that we squander our opportunities to make life better for ourselves and others by making ill-judged decisions. Worse, we sometimes dont decide at all folding like a puppet and allowing ourselves to be carried on a wave whose direction and purpose was decided by others.

A couple of months ago, Sassdas Board showed a strong sense of purpose in deciding that the association had to get back to basics. And, in deciding on a new Executive Director who could bring the newly refined objectives to fruition.

A great decision in my book, since it will, Im sure, result in an association more attentive to the needs of members and providing services equal to (or better than) major stainless steel bodies around the world.

Probably too infrequent are decisions that are good for the soul. A long love affair with the notion of loft-living in New York City, was nothing more than a pipe-dream for this South African boy. Two decades on, the same boy was lucky enough to have a successful strategic consultancy in the United States and was mentally prepared for the loft decision only to be out-decisioned by a Manhattan born and bred wife for whom the bucolic country lifestyle of Greenwich, Connecticut, was the deciding factor.

Another decade flashes by. Back in Johannesburg, the loft decision catches alight again this time thwarted by a lack of the real thing. Nothing curtails the loft decision, and we design and build what must be the only New York-style loft in Sandton (albeit in a house!).

Loft decision wins! Today I write overlooking a hundred square metres of uncluttered space with enough Stainless Steel to remind me of what funds our daily bread.

Coinciding with the issue date of this Stainless Steel Magazine is the Sassda 2012 AGM presenting a major and very real decision-making opportunity for members.

Sassdas Board has given the ship

a new direction. Its up to you to confirm the direction, or chart a different course.

You have the right to vote out pro bono Sassda office bearers not up to the job. You have the responsibility to support those who truly care about the organisation and its members.

Obviously, best done against an understanding of the purpose of Sassda.

Sassdas PurposeTo provide a platform for Sassda

members to collectively promote the sustainable growth and development of the industry with the main emphasis on increasing the conversion and consumption of stainless steel within the South African economy.

Probably not the finest prose (e. e. cummings could have done better), but truly defining the ethos of Sassda. The platform (a gathering place in physical and mental terms) is crucial, and so is the notion of collective promotion (group decision-making for the good of concerned participants).

Taking on the mantle of its parent, the Import Sectors purpose statement adds the important qualifier of being an income generating source.

Import Sector PurposeTo provide a mechanism under the

Sassda umbrella to assist in the financial support of the association, to assist Sector members and enable the sector to communicate in a fair environment the role of importers in increasing the conversion of stainless steel in the South African economy.

Harking back to 2006, the arguments then put forward for the creation of the Import Sector included:Levelling the playing fieldDeveloping the industry Equality of service to Local and Importing members Sassda is egalitarianDoes not differentiate between Local or Imported products Addressing the future change in local and import products percentageBetter balanced income stream Sassda is an all inclusive member association.

However lofty the ideals, Ill bet the focus was the penultimate point. Many members were reaping the rewards of membership by paying only a token membership fee. The burden of financial support of Sassda was on the shoulders of the one and only local stainless steel producer.

How do we get those importing members to contribute? The obvious answer an import levy.

But, not so easily done. The January 2007 presentation

carefully spelled out the consultation process and the levy collection method (per the following points):Person or firm actually paying at customs is liableCollect quarterly via declaration to 3rd party - independent audit firmImporters and potential importers listInvoice is generatedAnonymity of tonnage assuredDeclaration confirmed by annual audit certificate Resolution by Articles and Code of Conduct.

All well and good, except for

impOrT SECTOrSassdas

Gary Crawford: Its all about decisions

the enormous loophole provided by the first point. I import stainless steel, but as Im not a Sassda member theres no requirement or even obligation for me to pay the levy, said some. And, there were probably some Sassda members who bought from non-member importers and shared the belief that they were not obliged to pay.

They were correct the collection method clearly stating who is responsible for payment.

This bone of contention is still being gnawed on.

During the consultation process leading to import levy implementation, members were canvassed and 49 importers and 23 potential importers were identified.

Currently, 21 Sassda members report imports of primary stainless steel and pay the levy. Those members were named and commended in the previous issue of the Stainless Steel Magazine.

I commented that they are contributing in a very real sense to the associations activities and financial well-being.

So, one of the most crucial decisions to be made this year by members is how solve the under-the-radar problem. There have been growing rumblings of the need to change the Articles of Association so that Sassda members buying from direct importers will have to pay the import levy when first tier importers dont.

As Import Sector chairman, I have addressed the matter many times, sometimes appealing to conscience and fair-mindedness.

Now, its up to Sassdas members

to decide if this loophole should be closedOn a positive note, for vice chairman

Andr Visser and me, its crucial that the Import Sector provides a forum for active member participation where members may air matters of mutual interest.

We have reduced the formal content of Import Sector meetings as much as possible to allow more time for discussion and networking. And, following requests, the holding of meetings at different centres around the country, instead of only Johannesburg, is being considered.

You may be aware that active member participation is my hobbyhorse. I may sound like a broken record (or whatever the digital equivalent is), but as long as Im around Ill push for member

engagement. By the members, for the members, as it were.

For only then will decisions made by Sassda reflect the sentiment of the body as a whole, and not only those of a small group charged with the responsibility of directing the organisation.

On a personal note, although my loft love is still very much alive, Ive decided to change tack and am planning to build the ultimate green house that will be as off-the-grid as humanly possible. And, this time, my wife is fully behind the decision!

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Sassda or the authors employer.

FREESUBSCRIPTION

Interested in getting your favourite stainless steel magazine delivered to you or a valued client?Contact us for a free subscription.E-mail: [email protected] call Sassda on 011 883 0968



Success Through Failures?

It is generally understood that one should learn from ones past mistakes or better, from someone elses. Thus, failures are analysed to understand their mechanisms in order to avoid similar occurrences which could be costly and could lead to environmental pollution and/or fatalities. Stainless steel has been in existence for the past 100 years now (it actually is the centenary celebration this year), during which time the grades have been extensively researched to understand their properties and their behaviour in various environments. Improvements have been made resulting in new grades being added annually to the stainless steel family tree. Through all this research and practical experience, we have developed a fairly good understanding of the various grades of stainless steel and their potential uses. The question can then be posed as to why so many mechanical and corrosion-related failures still occur. For instance, the phenomenon of stress corrosion cracking (SCC) has been researched extensively, and it is well known that austenitic stainless steels are susceptible to chloride-induced SCC. HR Copsons classic paper published in 1959 provides the famous Copson curve, which plots the time-to-failure versus the nickel content. This curve illustrates that those alloys with 8 to 12% nickel are most susceptible to SCC. As it happens, this is the nickel content in Types 304 and 316, which jointly account for two thirds of stainless steel usage.

Further standard practices and guidelines exist to assist designers and materials specifiers in preventing costly failures. It therefore seems strange that analyses are still conducted annually on several components that fail due to chloride-induced SCC (to single out only one culprit). If the anticipated chloride concentration and operating temperature in the process are known upfront, then surely significant cost savings can be made? For example, if the chloride content is more than 100ppm and the temperature above ambient (generally

taken as higher than 50C), it should serve as a warning that closer attention is warranted. Although these principles are taught from short courses to degrees, they seem to be put aside when required for practical application. Another reason for frequent failures is ill-considered savings in the cost of construction materials, e.g. the use of Type 304 instead of more expensive duplex stainless steels (depending on the chloride level, temperature, stress level, etc.).

The use of ill-conceived or misapplied rules-of-thumb, such as that SCC only occurs above 50C, could also be disastrous. High profile examples of this include several collapsed indoor swimming pools. While it is widely published that austenitic stainless steels are susceptible to chloride-induced SCC (particularly Types 304 and 316 as highlighted by the Copson curve), Type 304 has been used for safety critical load bearing structural components in a number of constructions that subsequently collapsed. The three most published events include an indoor pool roof that

collapsed in Switzerland in 1985 resulting in 12 deaths. Type 304 tension rods were used in that instance. More recently in 2001, a suspended ceiling collapsed over a pool in the Netherlands. In that instance the fasteners were made from Type 304. In 2003 the roof of an indoor pool at a hotel in Finland collapsed. Once again the tension rods were made from Type 304. High levels of humidity (particularly associated with heated pools) lead to condensation of chloride-containing chemical species onto cooler parts at the roof at night. As this is a repeated cycle, the surfaces are eventually exposed to very aggressive chloride concentrations.

The three above-mentioned examples all contained the three elements responsible for SCC, namely: (a) susceptible material (i.e. Type 304), (b) tensile stress, and (c) a specific corrosive environment (i.e. chloride). All three failures were attributed to chloride-induced SCC, which could have been predicted and prevented.

The real question is how to communicate the message (from Polokwane to Pofadder) to prevent the recurrence of such mistakes?

This feature is an appetiser for future contributions on design and corrosion control. All comments are welcome, and suggestions for future articles will be appreciated.

Please contact Deon on [email protected]

NEWStechnical

By Deon Slabbert

The influence of nickel content on the SCC of stainless steel in boiling MgCl2 aerated solutions

Micrograph of transgranular stress corrosion cracking often associated with chloride-induced stress corrosion cracking of austenitic stainless steel

www.rimexsa.co.za / www.rimexmetals.com Tel (011) 793 3695/8 E-mail [email protected]

Industry leaders in the manufacture of aesthetic and functional steel sheet products, forging a

glittering track record including iconic buildings and projects throughout the globe.



Tel: +27 11 793 3695/8www.rimexsa.co.za

www.rimexmetals.com


NEWSindustry

ISO welding accreditationOne of the leading manufacturing

companies in the Western Cape, Fab-rinox, recently added to its credentials a new accreditation that will reinforce the companys vision to become a true glob-al sheet metal component manufacturer.

The company launched its ISO 3834 Welding Certification at a function at the Nitida Wine estate on the 11th of April this year. The key note speaker was Professor Madeleine du Toit, head of the department of material Science and Metallurgical Engineering at the University of Pretoria. Du Toit is also involved with SAIW, the accreditation body.

Pictured right are Jim Guild from SAIW and Ben Steenkamp, the production manager at Fabrinox.

Du Toit stressed the point that the accreditation must be seen against the unique scenario of welding in South Africa. It is a fact that South Africa is in the midst of an unprecedented cycle of public and private infrastructure development and welding continues to serve as the primary means of metal joining in the fabrication and manufacturing industries today. The global demand for consistently high quality welds in a wide variety of materials continues to grow, with increasing emphasis on basic and applied research in many welding-related fields. It is therefore of critical importance for local companies to gear themselves to be full participants in the

FABRINOx

potential that exists not only in South Africa, but globally. This makes accreditation to ISO 3834 of critical importance.

According to Du Toit, the South African fabrication industry faces three major challenges, namely Technology, Global Competition and Skills. It would therefore be important for the industry to ensure consistent quality through the establishment of Technology Centres and the company accreditation scheme conforming to ISO 3834.

Ben Steenkamp, Production Manager at Fabrinox, explained that the purpose of the ISO 3834 accreditation will be to provide the manufacturer with a means to identify, interpret and understand the customers requirements and real expectations, and by communicating the same to the work front being able to deliver to specified quality requirements. The fact that Fabrinox has elevated itself to this new level of service will open new global opportunities for the company and will also ensure that Fabrinox enjoys maximum opportunities with the national plans for infrastructure development, thus ensuring greater local content in these projects.

Andre Visser, MD at Fabrinox is of the opinion that this step for the organisation was an important step towards securing a maximized stake of local and international projects. The UNIDO benchmark during 2011 already showed Fabrinox to be a world class company and the accreditation to ISO 3834 will now confirm this to a greater extend assisting the company to ensure a sustainable and profitable future.

RImE

x

Rimex Metals Group turns 21Rimex Metals Group International is over 50

years old, with Rimex Metals SA being conceived 21 years ago. The Rimex Group is a global industry leader in the field of specialised sheet processing.

The South African operation started modestly 21 years ago with two patterned products and has grown to 26 products being produced locally and stocking 22 imported products.

Rimexs expertise in sheet processing allows for bespoke patterns and finishes to be produced on request. Product range includes standard flat sheet, patterned, polished, heavy duty floor plate and coloured sheet.

Rimexs present to itself was a 10 ton 1500mm wide cut-to-length and slitting line. The new division makes its core business more efficient as well as offering the service to the general market.


NEWSindustry

Sassda helps facilitate Unido benchmarkingSassda facilitated the Unido Benchmarking for Fab-

rinox to help the company benchmark itself internationally.In August 2010 Fabrinox attended a workshop,

facilitated by Sassda regarding the United National In-dustrial Development Organisation (Unido) program and acknowledged the importance of taking part in this bench-marking process.

In September 2010 Fabrinox were visited by the Sassda Regional Representative to assist it in the gathering of the correct information completing all the necessary documentation during a group session.

Fabrinox received its Unido SPX Supplier Bench-marking Results from Unido in October 2010.

Michel Basson, from Sassda says: In a recent survey completed by Unido, Fabrinox showed its compe-tency by emerging as a world class company.

The benchmark not only rated companies in terms of hard output, but also evaluated the internal processes and people management within the company.

Fabrinox has proven itself to be a truly global com-petitor and surely should be ranked as a solid example for organisations in South Africa trying to enter and compete in a very tough world market, he says.

As a result of Fabrinoxs participation in the Unido Benchmarking Process it was approached by 3PD Consult-ing in February 2011 to apply for Technology Assistance Package (TAP).

Later in 2011 Fabrinox participated in the Technol-ogy Capability Assessment conducted by 3PD Consulting.

In February 2012 Fabrinox were informed that its request for technology assistance were approved within the following areas:

Business processes Consulting and develop-ment upgrades to current ERP system.

Skills Development Training for technicians and operators on new equipment in Germany and Italy.

Access to expertise (a) Consulting towards imple-menting ISO 3834 and training for fusion welding and (b) Production monitoring system and machine utilisation.

FABR

INOx

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NEWSindustry


AIR P

RODU

CTS

vitals pressed floorsVital Engineering and An-

gus McLeod has invested extensive capital and resources in develop-ing a large range of quality grat-ings, stair treads, pressed floors and safety handrails over the past 73 years.

Dodds Pringle, MD of Vital Engineering and Angus McLeod, believes that the companys main differentiator in a highly competi-tive industry are its willingness to translate customer requirements into high-quality, application-based products. In addition, we main-tain a non-negotiable philosophy towards ensuring that not only are products designed and engineered to fit their specific needs, but the attention paid to quality assurance is unquestionable.

Pringle points out that the company was the first manufac-turer to offer fully serrated non-slip safety gratings to the market some 12 years ago. Trademarked as Vitagrid, this precision made high quality grating range has become the standard demanded by safety conscientious industries.

Vital Engineering has to date supplied millions of square metres of its fully serrated non-slip grating without a single failure and the same applies to Vitals stair treads. We have successfully sup-plied Vitagrid to large and small corporate mines, power genera-tion plants, petrochemical plants, the food and beverage industry and major office parks and shop-ping centres, says Pringle.

Perhaps the most import aspect of Vitals Vitagrid product range is that they use a little- ap-plied method to determine the products outstanding safety and performance characteristics.

Air Products gives back to the communityAn investment in the learners of today will pay dividends in terms of their con-

tribution to the economy in the future. Unfortunately, many of the learners in the rural areas do not have access to the information that will equip them for either a tertiary education or the job market.

Air Products believes that it has a moral and ethical role to play in the com-munities in which it operates, with assistance that will result in sustainability.

The company became actively involved with the Izazi Secondary School, situated in the Osizweni District near Newcastle, Northern Kwazulu-Natal, in 2008. Our initial soc

Stainless Steel Magazine May 2012

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Transcript of Stainless Steel Magazine May 2012