http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.14Change: -0.15
R/$ = 12.05Change: -0.20
Au 1200.03 $/ozChange: -6.12
Pt 1139.50 $/ozChange: -16.00
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Jun 22, 2012

Industry’s future dependent on full implementation of antidumping duties

Back
South African Fasteners manufacturers Association chairperson, Rob Pietersma, discusses the state of the South African fasteners industry. Camerawork and Editing: Darlene Creamer and Shane Wiliams.
 
 
 
Engineering|Africa|CBC|Export|MCEP|Mining|PROJECT|Stainless Steel|Transvaal Press|Africa|China|South Africa|Manufacturing|Product|Products|Reduced Manufacturing Base|Stainless Steel Screws|Steel|Israel Bender|Power|Rob Pietersma|Maryland|Far East
Engineering|Africa|Export|MCEP|Mining|PROJECT|Stainless Steel||Africa||Manufacturing|Products|Steel|Power|||
engineering|africa-company|cbc|export|mcep|mining|project|stainless-steel-company|transvaal-press|africa|china|south-africa|manufacturing|product|products|reduced-manufacturing-base|stainless-steel-screws|steel|israel-bender|power|rob-pietersma|maryland|far-east
© Reuse this



The future of the fasteners industry depends heavily on the recent provisional antidumping duties being fully implemented, South African Fasteners Manufacturers Association (Safma) chairperson Rob Pietersma tells Engineering News.

Last month, the International Trade Administration Commission of South Africa (Itac) imposed a hefty antidumping duty of 104.5% on the importation of fully threaded set screws with hexagonal heads, excluding stainless steel screws from China.

This followed an investigation by Itac, which found that these imported screws had caused local manufacturers to lose business.

In July last year, Safma submitted evidence of dumping to Itac. This showed undercutting, depression, and suppression of prices by China, resulting in a decline in capacity use, output and profit for local manufacturers and an increase in inventory levels.

Pietersma says the association brought the application on behalf of two large South African set screw manufacturers, CBC Fasteners, of which he is MD, and Transvaal Press.

These measures are seen as an extension of existing antidumping measures against Chinese and other Far East nut and bolt manufacturers.

The provisional duty will remain in force until November 2, by which time it is expected a full investigation by Itac would have been finalised.

Pietersma says that to understand the current state of the fasteners industry, it is important to consider the past.
“Imports really came into South Africa in the early 1990s and, at that point, they were coming in by the hundreds of tons. South African manufacturers were enjoying a big share in the local market and also had a stable export market,” he says.

However, he notes that, during the last 20 years, the growth of Chinese manufacturing and dumping has been a worldwide phenomenon.

“Since the 2008 global recession, imports have continued to increase and South African manufacturers tended to decline in numbers. The net result is a reduced manufacturing base,” he says.

He adds that, in the South African domestic market, imports have now escalated into the thousands of tons and, as a result of international competition, the country’s export market has been decimated.

“Another factor significantly influencing our position in the market has been the strength of the rand. Although we have seen times of weakness, there have been more times of strength,” he says.

In addition, he states that one should consider that some duties that were at about 19% in the early 1990s were reduced to 10% by the late 1990s, a factor that also fostered imports.

“So, my estimation of the reduction of employment in this relatively small industry is a 20% drop during the past three to four years.

“Manufacturing’s contribution to South Africa’s gross domestic product has also declined – 16% was the previous low and it is now at about 14%. It should be at 25%, where it has been historically,” he says.

Moving Forward

“The recognition by government that the manufacturing sector needs its assistance to grow and recent developments in the right direction to support growth are aimed at correcting imbalances in the industry, because it is through manufacturing that the country will be able to really create growth and jobs,” he says.

It is important to remember that South African manufacturers have not been, and are still not, assisted in any form by government, states Pietersma.

“That is why one has to look at manufacturers in the East. It is not just China that is exporting large volumes of goods to South Africa. These other countries in the East are also faced with a weak currency, as well as incentives and rebates to export.

“Those incentives and rebates are strongly supported by their governments and they are the factors that we are competing against, besides cheap labour,” he states.

Nevertheless, Pietersma is optimistic about government’s attempts to assist the local industry.

“The Department of Trade and Industry, in terms of its new Manufacturing Competitive Enhancement Programme (MCEP), has recognised the need to assist the manufacturing sector to gain the strong economic presence the sector used to enjoy,” he says.

The MCEP is aimed at inducing manufacturing firms to upgrade production facilities, sustaining employment and maximising volume addition in the short term.

Another significant contributor to the industry’s future is patriotism, asserts Pietersma.

“We find that many importers in the country are actually foreign-owned and/or foreign- managed; so the patriotism around creating South African jobs is minimal and such import distribution is actually supporting Chinese jobs as opposed to South African jobs.

“Safma represents South African companies that are locally owned,” he says.

Local businesses, like project and mining houses, which are huge consumers of fasteners, have a responsibility to buy products locally and support the local industry, he states.

“The only areas of growth for the fasteners industry of late have been power station activities. In spite of this, the industry is still smaller than it used to be.

“The prospects for the future of the industry rely on the antidumping duties being able to stick,” he says.

Pietersma adds that any implemented duties also need to be policed. He notes that Safma and CBC are willing to play any role they can to ensure that such policing happens.

“A lot of time, effort and money have gone into trying to secure these much-needed duties and it needs to be effective. Laws must not only be put in place, they also need to be policed. If you don’t police and levy the duties on the dumped goods properly, then you have nothing,” says CBC Fasteners financial director Israel Bender.

Pietersma emphasises that Safma is confident about the duties being permanently implemented.

“It is, of course, too early to say whether or not the duties will definitely be implemented, but Safma is confident, owing to the fact that we were able to submit strong prima facie evidence of dumping,” he says.

Edited by: Chanel de Bruyn
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Video News
More
 
 
Latest News
Two influential US senators, central to the so-called ‘chicken war’, have announced their intention to pursue amendments to the African Growth and Opportunity Act (Agoa) to secure greater access for US poultry into the SA market. “We believe passionately in Agoa’s...
The Independent Communications Authority of South Africa (Icasa) on Friday published the findings of a discussion document on South Africa’s television and radio local content environment. Icasa last year requested industry input as it reviewed and revamped...
Buying the catering unit of cash-strapped state airline South African Airways (SAA) could work for Bidvest Group, its chief executive said on Friday. SAA is considering selling some of its units including its inflight and airport lounge catering business, Air Chefs,...
More
 
 
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
 
 
 
 
 
This Week's Magazine
Today’s organisations execute projects within increasingly complex environments – particularly in the engineering sector. The ability to successfully execute these projects is what drives the realisation of successful projects and, ultimately, the achievement of...
SMART DISTRIBUTION Providing funds to introduce smart grid technologies in the absence of a clearly defined strategy will not result in the desired outcome
South Africa’s distribution grid is a twentieth-century relic, which must be changed to serve the country’s modern electricity needs, says South African National Energy Development Institute (Sanedi) Smart Grid Programme manager Dr Minnesh Bipath. “What we are...
There is a disparity in government funding provided to integrated transport networks – bus rapid transit (BRT) networks ¬¬– and that given to conventional bus services, says Putco executive director Thys Heyns. “We have neglected and strangled conventional bus...
The Johannesburg Social Housing Company (Joshco) is building 502 rental housing units, valued at R200-million, in Dobsonville, Soweto, which are scheduled for completion in June 2016.
Automotive component manufacturer and distributor Metair is centralising its research and development (R&D) work in Turkey, in an attempt to bolster the company’s ability to produce affordable start/stop batteries. The new R&D centre is part of an expansion plan in...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96