Slide 1

South African Institute of Foundrymen

“State of the Industry”

Presentation to:

7th BRICS FOUNDRY FORUM

14th March 2017

John Davies (SAIF - CEO)

Slide 2

1.  The Role of SAIF

2.  Foundry Industry in South Africa 2015 - 2016

3.  Skills Development, Training and Education

4.  Industry Challenges

5.  Conclusion

Presentation Outline

Slide 3

1. The Role of SAIF §  Listen to and respond to the industry needs

§  To be the voice of the industry §  Facilitate interventions to improve competitiveness §  Takes the lead in some interventions §  Provides feedback to industry members §  Disseminates technical and other information §  Focusses on skills development, training and education §  Promotes research in foundry processes and practice

More than 80% of manufactured products contain castings!

Slide 4 © CSIR 2006 www.csir.co.za

Slide 5

Foundry Industry in South Africa 2015 - 2016 §  Number of foundries has reduced to 165; 30% fewer than 2000

§  Total tonnage in 2015 of 430,300 tons is 35% lower than 2007 and 0,4% of world total

§  South Africa is ranked the 19th largest producer of metal castings in the world

§  A few big foundries (more than 500 people), but many small foundries (less than 20 people)

§  Several foundries only produce for their own use §  Adding value through design or machining and assembly is evident in

some foundries §  Two thirds of foundries are located in Gauteng province

Slide 6

Estimated Annual Production by Metal Type

Metal Casting Tonnage – World Totals = 104 129,257 tons South Africa Tonnage = 0,4%

Metal Type 2003 2007 2015 / 2016 Aluminium 66,000 77,800 24,000 Brass 9,000 8,200 Copper based

7,000 Bronze 6,000 7,600 Zinc 3,000 4,200 500 Grey Iron 110,000 147,000 145,000 Ductile Iron 100,000 86,000 41,200 Other Cast Iron (White Iron)

85,000 145,000 122,000

Steel 123,000 179,100 85,000 Total annual production

506,000 660,400 430,300

Slide 7

Industry Structure By Foundry Type

Foundry Type

No. of foundries in

2011

No. of foundries in

2016

Ferrous (Iron and Steel) 74 79 Non-Ferrous (Aluminum,

Brass & Zinc) Sand, Gravity, Low Pressure 70 56

High Pressure Die-casters 32 26

Investment Casting 4 4

Total number of Foundries 180 165

v  More than 50 foundries are making pump / valve components v There are an additional 13 art casting foundries and 11 spin

casting operations

Slide 8

Markets served by the SA foundry industry

Agriculture 3%

Railways 6%

Manufacturing 20%

Automotive 35%

Mining 32%

Other 2%

Infrastructure 2%

Slide 9

Employee Structure

Employee Structure % Administration 11,4 Technicians / Engineers 6,2 Workers 82,4

Tertiary Education Institutions

§  No Universities offer Foundry Engineering §  Two have Foundry Technology Courses §  Six offer Metallurgy / Material Science

Slide 10

Employment in the Foundry Sector

•  Estimated number of direct employees in 2016 – 9,000 - 80% of employees are previously disadvantaged individuals

•  Estimated number of indirect employees 3,200 (Adding Value to Products

in machining, sub-assembly and final assembly)

30%

55%

15%

Shop-floor analysis

Melters

Moulders

Patternmakers

Total of 12,200 Skill Base

Slide 11

•  Gauteng Foundry Training Centre (GFTC) Opened in 2014 near Johannesburg

Patternmakers, Melters and Moulders are trained for 3 years Industry support for specialized subjects and on – the – job work experience GDED, NFTN and EEC Partnership

3. Skills Development, Training and Education

Apprentice Training

Slide 12 © CSIR 2006 www.csir.co.za

Slide 13

Slide 14

Short Course Training (Worker Training)

•  Funded by the National Foundry Technology Network (NFTN) •  The SAIF has developed technical training material in many fields of

foundry technology including;

Melting & Metallurgy Practical Sand Testing Sand & Moulding Sands Heat Treatment Die Casting Stainless Steel Casting Cores & Core making Non Destructive Testing Fettling Casting Design & Methods Quality Control Productivity & Production Planning Supervisory Management

•  Customized training is also offered for on–site presentation •  Courses are for foundry workers and held outside normal working hours •  More than 2500 workers have attended at least one module

Slide 15 © CSIR 2006 www.csir.co.za

Slide 16

New Generation Foundry Forum

§  Funded by NFTN §  Targets young engineers in foundries §  Introduces new technologies §  Casting design, simulation and 3 D printing §  Problem solving techniques and management principles in marketing and

finance

Slide 17

Slide 18

§  Funded by Department of Science and Technology

§  Assist in transfer of Technology to Foundries

§  Testing of Sand and Cast Metal Samples

§  Design and Simulation

§  Training and Education

§  Special focus on very small foundries

§  Co-hosted the Research and Innovation in Foundry Technology (RIFT) project

with CPUT funded by the Department of Science and Technology (DST)

Metal Casting Technology Station

University of Johannesburg

§  Offers foundry courses as part of the engineering curriculum §  Collaborates with SAIF and provides support for the short course programme

Slide 19

Slide 20

Vaal University of Technology

§  Offers foundries assistance in design, simulation and 3 D printing of moulds and cores

§  A partner in the casting simulation network project

Slide 22

§  ALL assist with research and development in some aspect of metal casting technologies or the training and education of technicians, technologists and engineers

Other Institutions (MINTEK, CSIR, Universities)

Department of Higher Education

§  Through the Metals and Engineering and Related Industries Sectorial

Training Administration (MERSETA), assists in the development of

training programmes and the training of apprentices

§  The Quality Council for Traders and occupations is the quality council that

oversees the design, implementation, assessment and certification of

occupation including trades

Slide 23

§  Presented the “Expert” training programme in energy and waste

management to a group of foundrymen in 2016

National Cleaner Production Centre

Department of Health / Energy

§  Provided training via the International Atomic Energy Agency in the

regulation and control of radiated materials found in metal scrap

Slide 24

Challenges facing the SA Foundry Industry

•  Import leakages and reduction of orders due to slow economic growth. •  Lack the volumes to achieve the manufacturing economies of scale. •  Rising Energy Costs. •  Low Labour Productivity and Labour unrest. •  Lack of Skills development and training. •  Compliance with Environmental Regulations. •  Aged infrastructure for capital equipment parts. (average age - 17 years) •  High capital investment required to become world class. •  Limited Access to Capital. •  High Transport and Logistics Costs. •  Recent Technological Developments Require Special Skills. •  Foundry Environment is not attractive. •  Low capacity utilization at most plants. •  Slow pace of transformation

Slide 25

•  Availability of raw materials

•  Relatively competitive input costs such as rental, energy, labour (although these have been increasing);

•  Pockets of excellence in terms of manufacturing quality;

•  A high level of flexibility and engineering versatility, i.e. small production runs, mixed process and mixed metal production;

•  Spare production capacity – the foundry industry on average operates at utilization rates of 70% or less, based on a single shift scenario.

•  Localization and designation – The industry is well positioned to grow as a result of these programs .

• Capital Investment assistance from government – Sector Specific

Opportunities for the SA foundry industry

Slide 26

Conclusion

•  The South African Foundry Industry is facing strong headwinds, but with assistance from the state and other institutions several opportunities can be realised:

o  Improved Levels of Transformation o  Improvement of Skills and Technical Knowledge o  Increased Localisation and Import Replacement o  Foundries that are environmentally compliant o  Increased use of new Technologies o  Become increasingly more efficient and thus more cost competitive

Slide 27

Foundry Operations at the beginning of the 19th Century

Slide 28 © CSIR 2006 www.csir.co.za

Slide 29

THANK YOU