On 23 October the International Trade Administration Commission of South Africa (ITAC) announced the initiation of an investigation into the proposed increase in the ‘General’ rate of customs duty on certain bars and rods of iron or steel, whether or not alloyed, not further worked than cold-formed or cold-finished (Bright bars), classifiable under tariff subheadings 7215.10, 7215.50, and 7228.50, from free (0%) of duty to 10% ad valorem, on which comment is due by 06 November 2020.
The application was lodged by Macsteel Services Centres SA (Pty) Ltd who reasoned that:
• Prior to 2008, there were about five (5) manufacturers of bright bar products supplying the Southern African Customs Union (SACU) market and export markets. This number has since reduced to only three (3) manufacturers due to increased import pressure, particularly from Asian imports;
• While Macsteel’s production volumes of bright bar were on an upward trend prior to 2013, volumes have since plummeted to unsustainable levels in recent years, almost dropping by 50%;
• From 2014, Macsteel’s annual production volumes of bright bar declined sharply, year-on-year, despite the closure of a second SACU manufacturer of bright bar products in 2015;
• Imported bright bar products from Asia, for example, are cheaper than the local raw material cost; and
• Customs duty protection on the product will protect the bright bar industry against job losses and will ensure the future sustainability of SACU manufacturers.
The Government Gazette notice is available at:
https://www.gov.za/sites/default/files/gcis_document/202010/43834gen602.pdf
Story by: Riaan de Lange