Fastenright is appealing for the removal of the customs duty that was implemented on stainless steel fasteners on April 1. The duty was imposed as part of protection measures for the local fastener manufacturing industry through the implementation of a hot-rolled coil safeguard duty, which was approved by Trade and Industry Minister Dr Rob Davies last month.
The International Trade Administration Commission of South Africa (ITAC) reviewed the customs duty imposed on a number of downstream steel industry products following requests from a number of domestic fastener manufacturers to increase the customs duty applicable to stainless steel fasteners to their respective World Trade Organisation-bound rates of 15% and 30%.
Fastenright MD Rainer Lutz pointed out that there are no local manufacturers that can produce stainless steel fasteners in the range of sizes, standard of quality or volumes required by customers. Fastenright, in common with many fastener suppliers, imports its stainless steel fasteners from approved suppliers mainly from Asia and Europe, with material excellence certificates confirming quality. “These products always used to be duty-free but all stainless steel fastener importers in South Africa, are now casualties of what seems to be oversight in applying this customs duty to stainless steel fasteners..”
In his opinion, Lutz believes that for the very few local stainless steel fastener manufacturers, the customs duty offers little protection or incentive as they cannot compete on availability, quality or price with wellestablished and respected international manufacturers. Lutz fears that more unscrupulous suppliers may attempt to import goods under the wrong tariff heading – giving them an unfair advantage.
In response to Fastenright’s enquiry, the South African Fasteners Manufacturers Association has confirmed that all the stainless steel fasteners that the company is importing are not made by any South African manufacturers, except for screw studs and screw studding of stainless steel, more commonly known as threaded rods, which Fastenright acknowledges must be subjected to the customs duty to protect local manufacturers.
“If our application to ITAC is unsuccessful, we will be forced to significantly increase our selling prices as we cannot absorb the newly imposed import duties” said Lutz. “All suppliers are facing the same predicament, which will have an unnecessary inflationary effect on the entire South African stainless steel industry, affecting many other products that depend on using stainless steel fasteners for assembly.”ITAC urged to remove increased duty on stainless steel fasteners.