South African officials are working to prevent the closure of some steel mills operated by the local unit of ArcelorMittal SA this month, Trade Minister Parks Tau said, adding he is hopeful about success.

ArcelorMittal South Africa on January 6 said it would close facilities that produce so-called long-steel products in the towns of Newcastle and Vereeniging and a rail-fabrication facility in eMalahleni because it couldn’t make them profitable, risking at least 3 500 jobs.

Government and company officials are engaging “on a daily basis” and met in person Wednesday, Tau said.

“We are cautiously optimistic,” he said Thursday. “We are engaging to avert a situation where there would be a closure — discussions are at a sensitive stage right now.”

The Johannesburg-listed subsidiary of Lakshmi Mittal’s multinational group is idling the operations after persistently high logistics and energy costs — coupled with insufficient policy interventions by the South African government — made them unsustainable.

The shuttering would be a blow to South Africa’s already-struggling economy. It would also set back the coalition government’s reform program and President Cyril Ramaphosa’s infrastructure drive that requires as much as R4.8-trillion from the State and private investors.