Itac has announced the proposed reduction in the rate of duty on Canola/Rape seed, classifiable in tariff subheading 1205.10. Comment is due by 20 October.
The application was lodged by Agricol (Pty) Ltd who reasoned that (i) With the introduction of high yielding hybrid varieties, the retention of seed by farmers has become less viable. This has prompted the importation of the majority of the canola seed used by farmers for sowing purposes to grow canola supplied to oil processing facilities. The current customs duty thus increases the input costs of farmers. (ii) As canola competes directly with other crops such as wheat for arable land, the farmers will prefer to source a lower input crop with a higher return and thus other crop seeds are preferred. This of course does have an impact on the canola seeds crushing plants that must import the seed. (iii) The reduction in the rate of customs duty will allow for the importation of the seeds for sowing at a competitive price, ensuring that the industry can grow and also supply the subject product at competitive prices which will also benefit and expand the canola oil industry.