Iron/Steel Tariff Application
On 18 July 2014, the International Trade Administration Commission of South Africa (Itac) published an application for the proposed increase in “General” rate of customs duty on (i) wire of iron or non-alloy steel: plated or coated with zinc, classifiable under tariff subheading 7217.20, from free of duty to 10% ad valorem; (ii) barbed wire of iron or steel; twisted hoop or single flat wire, barbed or not, and loosely twisted double wire, of a kind used for fencing, of iron or steel, classifiable under tariff subheading 7313.00, from 5% ad valorem to 15% ad valorem; (iii) other grill, netting and fencing, welded at the intersection: Plated or coated with zinc, classifiable under tariff subheading 7314.31, from 5% ad valorem to 15% ad valorem; and (iv) other cloth, grill, netting and fencing: Plated or coated with zinc, classifiable under tariff subheading 7314.41, from 5% ad valorem to 15% ad valorem.
The application was lodged by Hendok (Pty) Ltd who reasoned that labour, electricity and the domestic price of steel have increased over the last few years resulting in increased domestic ex-factory cost. This has left the Sacu industry vulnerable to imported products being sold at or below the domestic manufactured costs.
Comment is due by 15 August 2014.
Lead Acid Tariff Application
On 18 July 2014, Itac published an increase in the “General” rate of customs duty lead-acid, of a kind used for starting piston engines, classifiable under tariff subheading 8507.10, from 5% to 30% ad valorem.
The application was lodged by Powertech Batteries, a division of Powertech Industries (Pty) Ltd who reasoned that in recent years imported automotive lead acid batteries have continued to flow into the Sacu market. As a result, Sacu manufacturers have found it increasingly difficult to compete as the pricing models adopted by foreign manufacturers are often below local costing. The net effect of this influx of low-priced batteries is a threat to the local battery manufacturers' sales, market share and employment. A number of battery importers are sending back scrap batteries to the countries where they were originally manufactured. This raises the cost of local recycled lead, making Sacu manufacturing uncompetitive and uneconomical. It is estimated that importers have grown their share of the South African battery market from about 8.5% in 2010 to just over 20% in 2013. This has had a significant negative impact on Sacu manufacturers, which is further compounded by scrap batteries.
Comment is due by 15 August 2014.