SOUTH Africa has notified the World Trade Organisation (WTO) of its intention to impose a 9% duty on hot-rolled steel products, effective from today, to protect the local industry from a surge in imports.
XA Global Trader Advisors said the Gazette Notice was expected imminently. Developing countries would be exempt from this duty and the provisional safeguard measure would last up to 200 days.
In February, the South African Iron & Steel Institute (SAISI), on behalf of ArcelorMittal South Africa (Amsa), applied for a safeguard on hot-rolled steel.
The International Trade Administration Commission of South Africa then initiated a safeguard investigation into hot-rolled steel.
SAISI alleged in its complaint that the Southern African Customs Union industry was experiencing significant harm, causally linked to the recent surge in imports of the subject products. They alleged that unforeseen developments had led to a surge in imports of hot-rolled steel products.
It said in its complaint, “Chinese steel producers aggressively export due to excess capacity and economic slowdown. This imbalance led to increased exports from countries with excess capacity. Chinese producers further increase exports at reduced prices to manage excess stocks.”
SAISI argues that countries worldwide were taking urgent actions to raise tariffs and implement trade remedies to safeguard their domestic steel industries.
The National Employers’ Association of South Africa strongly disagrees with the tariff.
Amsa has previously told Business Report that South Africa needs to preserve its steel industry as the backbone of its manufacturing industrial economy.
Earlier this year Amsa posted a headline loss of R1.8 billion for the full year ended December 2023 against a profit of R2bn in the year earlier.
It it might have to close its Newcastle and Vereeniging plants amid a myriad challenges in South Africa, including tariffs.
Amsa in February deferred the closure of its Newcastle and Vereeniging steel mills by six months, but said it would revert to its original decision to shut down the longs steel businesses if there is no progress in government commitments to fix Transnet, other infrastructure and policy framework bottlenecks.
Business Report did not manage to get Amsa comment by the time of going to print.
BUSINESS REPORT