The year 2018 like the years before has been a trying and challenging one for the steel tube and pipe industry as a whole, exacerbated on the domestic front by dwindling local demand and the constant influx of finished steel tube and pipe imports from Asia.
The export of steel tubes and pipes has encountered strong unabating headwinds in the global context when one considers the imposition of the USA’s section 232, sanctioning a 25% tariff on carbon steel tube and pipe imports. The attempts by government at different forums i.e recent AGOA forum, to get SA exempt from section 232 have so far been fruitless and another great fear looms if section 232 is extended to AGOA agreements, which would have an adverse impact of SA’s automotive exports. Practices of such trade protectionism by the USA has also prompted the likes of the EU to evaluate their “national security” regarding the trade of steel tubes and pipes and unfortunately when large trading blocs and countries are at loggerheads, emerging market nations like South Africa are collateral damage.
On a positive and progressive front, the ASTPM has over the past year been engaged with SARS over the introduction of an import reference price on certain steel tube and pipe HS code lines as a mechanism of halting the unjust practices of under- pricing/ declaration, incorrect identification of products among others. The import reference price was officially instituted by SARS on 1st August 2018 and has thus far yielded great results. Associations such as SAMCRA and SAWA have also successfully had their product related import reference prices activated by SARS.
STEASA has taken a proactive approach to addressing export challenges which the industry is acutely aware off. Even with the current impediments to competitive exports, STEASA has been engaging with Trade Advisory, a specialised division of the University of NW Potchefstroom Campus, who have developed a Trade Export Decision Support Model (DSM) that helps companies to identify realistic export opportunities. TRADE-DSM (Decision Support Model) which is an analytical tool that identifies realistic export opportunities for both export-ready and active exporting companies that wish to expand their sales reach into foreign markets. Part of the value in the TRADE-DSM lies in its ability to offer alternatives to exporters that are facing saturation and/or declining growth in their traditional markets.
Overall we have worked well with industry stakeholders and government stakeholders, the likes of the metals desk at dti, ITAC, Trade Investment Africa (TIA), Trade Investment South Africa (TISA), Gauteng Growth development Agency (GGDA) among others, in addressing our most salient and on going efforts regarding tariffs for the midstream and downstream, designation, export competitiveness, demand creation for the capacity for steel tubes and pipes, promoting concrete filled tubular columns and addressing standards and codes.