South Africa’s already
bleeding steel industry –
plagued by job losses, a
slump in commodity prices
and increased competition
amid a global steel glut –
now potentially stands to
lose revenue of about US$7.1
million in carbon and alloy
steel wire rod exports to the
United States.
Last week
US secretary
of commerce,
Wilbur Ross,
announced
antidumping
duty (AD)
investigations
on carbon and alloy steel
wire rod from Italy, Korea,
South Africa, Spain, Turkey,
Ukraine and the United
Kingdom, finding that
“producers/exporters in
these countries have sold
carbon and alloy steel wire
rod in the United States at
less than fair value”.
“The dumping of goods
below market value in the
US is something the Trump
administration takes very
seriously. The Department
of Commerce will continue
to stand up for American
workers and businesses
in order to ensure that
everyone trades on a level
playing field,” said Ross in a
statement.
A spokesperson for the US
Department of Commerce
told FTW that enforcement
of US trade
law was a
prime focus
of the Trump
administration,
highlighting
that from
January
20, 2017,
through October 25,
2017, the department had
initiated 73 antidumping
and countervailing duty
investigations – a whopping
52% increase from the
previous year.
The spokesperson
added that in the South
Africa investigation, the
department of commerce
had found that exporters
had dumped wire rod in the
United States at margins
of between 142.26% and
135.46%.
In the interim, the
department will instruct
US Customs and Border
Protection (CBP) to
collect cash deposits from
importers of wire rod from
all the countries, based on
these preliminary rates. It
is scheduled to announce
its final anti-dumping
determinations on January
9 next year.
Steel and Engineering
Industries Federation of
Southern Africa (Seifsa)
chief economist Michael
Ade said that affirmative
determinations, coupled
with the US International
Trade Commission (USTIC)
final injury determinations,
would result in the
Commerce Department
issuing anti-dumping orders
and imposing relevant
duties, thus increasing local
steel producers’ exporting
costs – which would
eventually squeeze their
profit margins.
According to him, the
US investigation is a “titfor-
tat” retaliation for the
South African domestic
steel industry successfully
pushing for import tariffs
and safeguard duties on
cheap international imports.
“This highlights the
long-term
demerits
of inwardlooking
protectionist
trade
policies,”
said Ade.
He referred
to the US
enquiry as
the “tip of
the iceberg”
which
could be a
precursor
to extension
to other
domestic
steel products, potentially
resulting in many overseas
trading partners starting to
retaliate and to protect their
steel industries.
“This is of grave concern
to Seifsa, given the strategic
importance of the local steel
industry. The need for unity,
including support for a
sector-related government
policy stance from all
stakeholders across the
value chain of the local steel
industry, is imperative,” he
pointed out.
Minister
of Trade and
Industry, Dr
Rob Davies,
agreed with
the expressed
concern
that trade
protectionism
was on the rise
globally. He
told delegates
at the 20th
African,
Caribbean and
Pacific (ACP)
Ministerial
Committe
meeting in Brussels,
Belgium last month that
barriers to international
trade particularly
affected small and
medium enterprises
and downstream
manufacturers.
INSERT & CAPTION
The US investigation is
a ‘tit-for-tat’ retaliation
for the South African
domestic steel industry
successfully pushing for
import tariffs on cheap
international imports.
– Michael Ade
INSERT
73
The number of anti-dumping
investigations initiated by the
US between Jan-Oct 2017.
