South African importers are turning global price wars to their advantage, according to an analysis of imports for the first six months of 2019 undertaken by Trade and Industrial Policy Strategies (TIPS) for the department of trade and industry (dti). Traditional logistics chains have been affected, with importers switching to suppliers in different countries. Chinese manufacturers who reduced the average unit price of primary cells and batteries from R0.53 to R0.38 grew their share from 82% in the second quarter of 2018 to 98% in 2019. South Africa’s other suppliers of primary cells are Belgium, Poland, Thailand and Hong Kong. A 99% drop in price by German suppliers of photographic plates and films led to a May surge of around 6 700% in the square meterage of the imported products (HS 37013090), which are predominantly used in medical imaging. This was probably the result of customers taking advantage of the low prices. The average price of photographic plates and films dropped to R1.52 a unit. “The unit price for this item fluctuates quite often, but often remains above R100,” states the report. German and Swedish exports of instruments, appliances and machines for measuring or checking products (HS 90318000) to South Africa also grew following a unit price drop in German products from R461 a unit in the second quarter of 2010 to R14 in the second quarter of 2019. Swedish unit prices dropped from R15 612 to R13 in the same period. “At present, this does not appear to be a data error related to misclassification, but it could be a new or different type of product being classified under this category,” state the authors of the report. “Given the significant change in unit price, this surge will be monitored in the coming quarters to establish the correctness of the data,” they add. “Given the significant change in unit price, this surge will be monitored in the coming quarters to establish the correctness of the data. Imports of gaseous hydrocarbons (HS 27112990) surged from 366 kg in the second quarter of 2018 to 16.3 million kg in the second quarter of 2019. The bulk of the imports (61%) came from Mozambique, with another 39% from the US, and minuscule quantities from the United Kingdom (UK) and Germany. “The two countries overtook Germany, which has consistently supplied South Africa with gaseous hydrocarbons for more than a decade, albeit in small quantities not exceeding 20 000 kg each quarter,” states the Import Tracker report. Another interesting trend is that India replaced Hong Kong as the main supplier of maize starch. Almost all imports of maize starch in the second quarter of 2019 came from India (11.1 million kg), with the balance (184 kg) sourced from Portugal. “Previous imports of maize starch have not exceeded 90 000 kg, and thus the surge to 11,1 million kg in the second quarter of 2019 warrants further analysis,” states the report. Another food anomaly is the growth of food preparations, (HS 21069090) to 17.6 million kg in the second quarter of 2019, up from 5.5 million kg in the second quarter of 2018, with the main suppliers coming from the United States (US). “It appears that the US is looking for markets for their products, which have been impacted by the trade war (with China). “The surge in the quantity imported saw the unit price for products from the US decline from R160 in the second quarter of 2018 to R7 in the second quarter of 2019, suggesting a sense of urgency on the side of the US to find other markets,” state the report authors.
INSERT: It appears that the US is looking for markets for their products, which have been impacted by the trade war (with China). – Report