daniel chigunweSouth Africa is embarking on the largest ever review of steel tariffs just as ArcelorMittal SA (Amsa) announced the closure of its long steel business, including its Newcastle and Vereeniging plants as well as its rail and structures operation.
This comes just months after Amsa received a 52,81 percent anti-dumping duty on structural steel. If that’s not enough to keep its plants running, then the problems clearly run much deeper than competition from imports.
The anti-dumping duty comes on top of a 10 percent duty on imported long-rolled steel, which is the maximum allowable under SA’s commitments to the World Trade Organisation.
SA’s steel industry is a sea of competing interests — some calling for further protection, others lobbying for more open markets.
Last week, Gerhard Papenfus, CEO of the National Employers’ Association of South Africa (Neasa), called for the scrapping of import duties on all long steel products with immediate effect now that the company will no longer be involved in long steel production. The only purpose in keeping tariffs on long steel products is to generate revenue for the state.
Others have blamed Amsa’s woes on an oversupply of finished products in the domestic market, which has pushed long-steel products below international prices.
“As the government and the industry grapple with an oversupplied steel sector and weak local demand, they must not prioritise saving the older, heavily polluting and poorly structured Amsa above all else, but rather look at saving as much of the whole steel market as possible,” wrote Cape Gate chair Oren Kaplan in Business Day.
“Amsa should not be saved at the expense of the rest of the long steel industry.” — Moneyweb.
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