Sep 14, 2012
Low-quality imports affect manufacturersBack
Springwell|China|South Africa|Port Elizabeth Factory|Lower-priced Finished Products|Lower-priced Imported Products|Machinery|Andrew Ogden|Bushy Botha|Keith Campbell
© Reuse this
“These imports are not the same standard as the materials that would be available from domestic mills, but buyers are currently price conscious as a result of the economic downturn and are not as concerned about quality as they should be.
“We have the capacity to produce these imports locally, which would generate business for domestic mills, as well as employment,” he states.
Sawa has expressed concern about the impact of lower-priced imported products since the South African government abolished import duties on wire in 2006.
The abolition of these import duties has resulted in local wire users being able to import duty-free and cheaper-priced wire from vendors such as those in China.
In 2008, the chairperson of Sawa, Bushy Botha, told Engineering News that South Africa was one of only a few countries that had duty-free imports on wire and that imports had increased noticeably since these duties were abolished.
“Although the reason for the abolishment was to lower costs for South African consumers, there could have been more local production if there had been more protection,” he said at the time.
Campbell notes that, while imports dropped during the first quarter of this year, this was the result of a decrease in demand for domestic materials, owing to economic factors.
He adds that this cannot be seen as an improvement in the import problem.
Further, he points out that Sawa members continue to look towards export markets to improve their sustainability and competitiveness, as the local wire industry has excess capacity as a result of low domestic demand.
Meanwhile, Spring manufacturer Springwell technical director Andrew Ogden believes the only way for companies to ensure competitiveness in the local wire industry is to acquire machinery that can deliver the high volumes of commonly used wire often demanded at low prices.
Springwell has invested in machinery, which allows it to be more competitive and widen its product offering as well as improve its ability to produce formed wire for various applications.
Ogden adds that the company plans to further invest in machinery to add to the product forming capabilities of its Port Elizabeth factory.
He points out that, while the local manufacture of speciality wire could create jobs in South Africa, demand for such products is too low to make it economically viable for companies to invest in technologies to produce speciality goods.
Currently, commonly used wires are readily available in South Africa, while speciality wires have to be imported when a solution is needed for specific purposes.
Campbell says, in South Africa, wire manufacturers and consumers use wire for low-tech products, such as fencing materials and fasteners, which is why there is limited local demand for speciality wires.
“Domestic volumes are too small for wire producers to manufacture speciality wires,” Campbell emphasises, adding that raw material availability is also curbed, as manufacturers are not interested in producing small quantities of specialised materials.
Edited by: Chanel de Bruyn© Reuse this Comment Guidelines
Other Wire, Rope, Sling and Chain News
Recent Research Reports
Steel 2014: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2014 report provides an overview of 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 steel and stainless...
Projects in Progress 2014 - First Edition (PDF Report)
This publication contains insight into progress at the delayed Medupi and Kusile coal-fired projects, in Mpumalanga and Limpopo respectively, as well as at the Ingula pumped-storage scheme, which is under construction on the border between the Free State and...
Automotive 2014: A review of South Africa's automotive sector (PDF Report)
The report provides insight into the business environment, the key participants in the sector, local construction demand, geographic diversification, competition within the sector, corporate activity, skills, safety, environmental considerations and the challenges...
Construction 2014: A review of South Africa's construction sector (PDF Report)
Construction data released during 2013 hints at a halt to the decline in the industry during the last few years, with some commentators averring that the industry could be poised for recovery. However, others have urged caution, noting that the prospects for a...
Electricity 2014: A Review of South Africa's Electricity Sector (PDF Report)
This report provides an overview of the state of electricity generation and transmission in South Africa and examines electricity planning, investment in generation capacity, electricity tariffs, the role of independent power producers and demand-focused initiatives,...
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
This Week's Magazine
The Electronic Systems Laboratory (ESL) of the Department of Electrical and Electronic Engineering at Stellenbosch University is strongly reaffirming its position as one of South Africa’s leading centres for satellite technology and expertise. It is currently...
The world’s lowest-cost diesel-electric locomotive is not made in China, but in Pretoria, at RRL Grindrod Locomotives’ newly upgraded 30 000 m2 plant. The company’s locomotive pricing is “more competitive than any other original-equipment manufacturer (OEM)...
The South African Defence Review 2012, released to the public at the end of last month (despite the year given in its title) recommends the creation of the post of Chief Defence Scientist. This official would be responsible for the management of defence technology...
AltX-listed engineering technology company Ansys has been awarded an R188-million contract by Transnet to supply integrated dashboard display systems to the freight rail utility’s locomotives. Black-owned and controlled Ansys developed the bespoke integrated system...
South Africa’s sole nuclear power station Koeberg, which is located in the Western Cape, breached a major operations milestone on April 4, which marked the thirtieth anniversary of Unit 1 having been connected to the grid. Eskom, which operates the two-unit plant,...