Hennie de Clercq, the institute's executive director, said it was believed the sluggish global economic environment and uncertainty created by the war would lead to the postponement of major construction projects in southern Africa.

"Many local and international projects are being put on hold until there is some certainty on the outcome of the war and as a result there is likely to be a fall in demand during the short to medium term," he said.

De Clercq said demand during the coming year was not expected to exceed 250,000 tonnes -- worth about 2.5 billion rands (315 million dollars / 294 million euros) -- whereas a few months ago the institute had reason to expect that as much as 500,000 tonnes of steel would be used in 2003.

"This followed a good 2002 which saw sales of about 350,000 tonnes."

The Johannesburg-based Business Day newspaper said Aveng, South Africa's largest construction company, had estimated that structural steel demand would drop by a maximum of 20 percent within four to six months.

Africa's largest steel maker, Iscor, will make public its expectation for steel sales later this month when it releases its quarterly results.

SPACE.WIRE