The country’s steel and aluminium barons joined the government in raising fears about what the impact of the unprecedented move would be on the industry.
SA Institute of Steel Construction (Saisc) chief executive Paolo Trinchero said that the institute was waiting for the finer details to be released. Trinchero said the institute remained concerned on the impact the tariff would have on the local businesses.
“We are concerned, and we have raised our concerns with Department of Trade and Industry (dti) and the government-led steel task team,” Trinchero said. “In our weak economy, we would hate to lose any business; exports are important as the construction industry is subdued.”
On Thursday Trump officially signed off on import levies on steel and aluminium imports into the US, citing national security as a reason.
Trump said the door remained open to further exclusions for countries and niche products, raising questions about whether the tariffs will have the intended effect of shoring up the domestic steel and aluminium industry to protect US national security.
Trump hinted that he could exempt nations such as Canada and Mexico when he formalises the tariffs on condition they agreed to an updated North American Free Trade Agreement with the US.
The move sparked threats of retaliation from US trading partners and escalated warnings from his own party that it would hurt American businesses and consumers. The EU said it would press for exemption from the tariffs while China threatened retaliation.
Last week the dti said that South Africa’s exports to the US on steel amounted to $950million (R11.2 billion) in 2017 and accounted for 1.4percent of the US’s global imports.
The department said South Africa exported $375m worth of aluminium in 2017, accounting for 1.6 percent of US imports from all global suppliers.
“It is clear that South African exports do not impose a threat to US industry and jobs,” the dti said. “The South African exports are in some cases used as inputs into further processes in the US manufacturing sector, thus contributing to US jobs and production.”
The dti said it was assessing the compatibility of the proposed measures with the rules of the World Trade Organisation.
Africa’s biggest steel producer, ArcelorMittal South Africa (Amsa), said it only dispatched around 70000 tons to the US in 2017, which amounted to less than 2 percent of the company’s total sales of over 4 million tons in 2017.
“ArcelorMittal South Africa’s primary markets remain South Africa and Africa overland,” it said.
Acting executive director of the Aluminium Federation, Rentia Malan, said the tariff would hurt the industry.
“It (the tariff) will not benefit the industry, and is definitely negative,” said Malan, whose federation represents 100 companies.
South Africa’s aluminium supplier and exporter, Hulamin, said it was premature to comment. “The uncertainties about implementation remain prevented it from making definitive comments at this stage.”
Global diversified mining company South32, which produces aluminium from a smelter in Richards Bay, said its US footprint remained small as a share of total sales across its diversified book selling into the Americas, Europe, Africa and Asia.
“Our diversified portfolio means we are well-placed to manage any potential impact,” said South32.
- BUSINESS REPORT