Nov. 5, 2021


Luis Diogo

Angola

Luis Diogo

CEO, Fabrimetal

“We have been around 60% of our full potential, but by the end of this year we will be able to use the total capacity.”

BIO

Luis Diogo is CEO of Fabrimetal.


Fabrimetal was established in 2005, within MMD Steel Group. What is the mission and vision of Fabrimetal?

In one word: ambition. We have an ambitious goal of being present in 15-20 countries by 2031. The group started in 2004-2005, and we have grown substantially, especially in the last 10 years, reaching new achievements every month. We expect to start our operations in Burundi in 2022. Our stakeholders are passionate about Africa. Consequently, our expansion plans are focused on Africa. Our vision is to become the biggest player on the continent by being closer to our customers in the markets where we currently participate. Our main raw material is scrap metal. In the future, it could become a scarce resource, and this may occur in less than five years, so we want to go into other directions, such as mining.

What makes Fabrimetal a special company in the industrial sector?

First, we buy more than 60% of our raw materials in the country, so we are not a major importer. Second, we support other industries and are a source of income for people who bring in the scrap to us. We receive 500 tons on average per day. This represents an income for the families. We invest heavily in quality. In 2010, we started working in Angola, and until 2012 this market consumes of around 25,000 tons a month, and no one was producing in Angola; therefore, everything was imported. In 2014, we were producing 2,500-2,800 tons, and at the time imports were still strong because we were only starting. The crisis arrived, and someone needed to create the foundation to receive the local procurement and supply the local market. In 2015, we did a turnaround of our business, improving our management and investing in infrastructure. From 2015-2016, our revenue breakdown changed from 80% from the informal market to 60% formal. We opened the doors to the shift of the market. In 2015, we were producing 3,000 tons, and today we are reaching 12,000 tons.

Fabrimetal is an active job creator for local communities, counting with more than 500 local workers, proving a strong commitment with Angola. How has Fabrimetal helped the development of its workers and their families?

When we started producing in Angola, the experience of human labor in our sector was zero, since in the past there was only one company producing steel. As a result, we became a training center of sorts. When we started, we employed people and taught them the nature of our work. Today, we are more focused on empowering people and giving them more benefits, which boosts retention. We have a cafeteria where they can have three meals a day, we have a medical assistance available 24 hours every day, and many more. We are committed to our people and their families. We are also trying to work with local communities near us, having local activities and improving their living conditions. Our people are important to us and we want them to be happy working with us.

What can be done in terms of public investment to help the industrial sector?

Angola has everything it needs to develop more and attract investors. The country is big, and there are many opportunities here. The challenge is to go from talk to action. In the past three to four months, we have perceived some changes, and now there are more incentives for investors to come to the country. We are still in a crisis, but with more structure the future will bring more opportunities. The country is playing a key role in the development of the African Continental Free Trade Area (AfCFTA). We started exporting in 2016 to pay the bills, even though our first commitment was to cater to the local market. Every year, we are more competitive in the international markets. In 2021, we are exporting 2,000 tons per month. We can enhance those numbers, because as prices increase in the international markets, we become more competitive outside, being able to produce more and more efficiently.

What are your plans in Angola?

Since 2010, we have slowly started to increase our capacity. Last year, we concluded an investment of USD25 million to increase our melting and processing capacity for scrap. We also improved the power supply, which did not allow us to fully produce according to our installed capacity. We have been around 60% of our full potential, but by the end of this year we will be able to use the total capacity. The next goal is to continue being innovative, staying ahead of the competition and continue expanding and building on our strengths which are producing high quality steel and complementary products, as well as transparency in our dealings with suppliers and clients and working hand-in-hand with our community and business partners. We maintain the same level of integrity, principals, and transparency. In addition we will potentially look at mining iron ore as a substitute for our raw material, scrap.