South Africa introduces 13% duty on hot rolled steel

The South African government has ended steel importers’ wait for clarity on its steel import safeguard duty on hot rolled coil and plate with the imposition of a 13% rate from May 1.

An official document, issued on behalf of the country’s minister of finance, Enoch Godongwana today (May 2), confirmed the new duty. The International Trade Administration Commission of South Africa initiated its investigation into the safeguard duty on various hot rolled flat products on January 17, three days after the 200-day implementation of the earlier 9% duty lapsed.

As well as hot rolled coil and sheet, certain galvanised products are also subject to the new duty, in addition to the 10% import duty already in place. However, the official government document, published today, lists a number of countries to which the new rates do not apply.

MEPS steel market analyst Stuart Gray said that, despite clarity of the new South African safeguard duty, the country’s flat steel buyers were stepping back from the market.

“A combination of rising imports, the change to safeguards and the ongoing wait for the outcome of an ongoing antidumping investigation – added to the current uncertainty about global trade – has introduced an element of fear,” he said.

“The antidumping investigation into coil and plate imports has proposed duties of 72% on Chinese-origin material, 24% on imports from Japan 24% and 30% on imports from Taiwan. Many South African buyers are now seeking alternative sources of import supply. However, MEPS respondents say that there is very little interest in imports, right now due to continued uncertainty about possible tariffs and duties.”

Research conducted for the April edition of MEPS’s Developing Markets Steel Review revealed that the South African steel market had been “flooded” with imports of flat rolled material in recent weeks. This has increased inventories, reducing demand.

Despite the introduction of the new safeguard duties for hot rolled coil and plate, the International Trade Administration Commission of South Africa is also undertaking a comprehensive review of the current import tariff structure across all steel products. The scope of the investigation includes both tariff and non-tariff measures, such as the use of import permits. A public consultation on the proposed measures concluded on April 16.

• Regular insight from the South African steel market is included in MEPS's Developing Markets Steel Review. The monthly publication provides steel prices, price indices, market commentaries and six-month price forecasts from the United States, Canada, China, Japan, South Korea and Taiwan, as well as seven European steelmaking states.