I REFER to your article of June 23 (Steel tariff task force ‘too little, too late’). Cheaper imports flooding into SA, especially from China, have threatened the viability and sustainability of the primary steel industry in SA and other countries. The South African government has responded to address industry challenges, although the response has been slower than in other parts of the world.
The US, for example, has implemented a 265.9% anti dumping duty on steel imported from China.
As a developing nation with ambitions to undertake major infrastructure projects and bring services to its people as required in the National Development Plan, a primary steel industry is necessary to offset and protect the local industry from price movements brought about by the import and currency markets.
Domestic and international suppliers and customers have experienced firsthand the withdrawal of import offers by Chinese mills without honouring previously committed prices. This led to a price run in the market in excess of $200 per ton on hot rolled coil since March, which has subsequently reversed during May and June due to previously unprofitable mills in China coming back on line to flood the market.
Should SA allow its primary steel industry to fail, the country will be held to ransom by this behaviour.
In 2015 ArcelorMittal SA led a process with other industry stakeholders, including organised labour and industry associations, to engage government on the adoption of measures to protect the domestic industry. These included import tariffs, which if not implemented would have negatively affected the domestic steel industry in the face of tough trading conditions. I t was agreed that a committee be established to monitor the impact of trade tariffs and ensure domestic steel producers comply with the conditions set out as part of the duties granted.
The future of a vibrant economy in SA, including a sustainable primary steel industry, is under threat. This requires solutions that take into account a longer-term view and balances the interests of various stakeholders so the pain is shared, in the interest of our collective future. This is what has been done.
Dean Subramanian
Acting CEO, ArcelorMittal SA
An ArcelorMittal steel factory in Zenica, Bosnia and Herzegovina. Picture: REUTERS
I REFER to your article of June 23 (Steel tariff task force ‘too little, too late’). Cheaper imports flooding into SA, especially from China, have threatened the viability and sustainability of the primary steel industry in SA and other countries. The South African government has responded to address industry challenges, although the response has been slower than in other parts of the world.
The US, for example, has implemented a 265.9% anti dumping duty on steel imported from China.
As a developing nation with ambitions to undertake major infrastructure projects and bring services to its people as required in the National Development Plan, a primary steel industry is necessary to offset and protect the local industry from price movements brought about by the import and currency markets.
Domestic and international suppliers and customers have experienced firsthand the withdrawal of import offers by Chinese mills without honouring previously committed prices. This led to a price run in the market in excess of $200 per ton on hot rolled coil since March, which has subsequently reversed during May and June due to previously unprofitable mills in China coming back on line to flood the market.
Should SA allow its primary steel industry to fail, the country will be held to ransom by this behaviour.
In 2015 ArcelorMittal SA led a process with other industry stakeholders, including organised labour and industry associations, to engage government on the adoption of measures to protect the domestic industry. These included import tariffs, which if not implemented would have negatively affected the domestic steel industry in the face of tough trading conditions. I t was agreed that a committee be established to monitor the impact of trade tariffs and ensure domestic steel producers comply with the conditions set out as part of the duties granted.
The future of a vibrant economy in SA, including a sustainable primary steel industry, is under threat. This requires solutions that take into account a longer-term view and balances the interests of various stakeholders so the pain is shared, in the interest of our collective future. This is what has been done.
Dean Subramanian
Acting CEO, ArcelorMittal SA
