The World Trade Organization (WTO) has published a filing by South Africa proposing emergency “safeguard” tariffs on imports of certain flat hot-rolled steel products. This would come into effect from July.
According to the papers, the International Trade Administration Commission (ITAC) began investigating the case for safeguard tariffs in March 2016, and had made a preliminary determination that they would be justified by November. However, Reuters reports that a WTO committee meeting was told that ITAC had recommended ending the investigation into cold-rolled steel, according to a trade official who attended the meeting.
The proposed tariff would be in place for three years, and fall from 12% in the first year to 10% in the second year and 8% in the third. Many developing countries would be exempt, but imports from major producers such as China and India would be covered by the charge .
The filing states that South Africa’s domestic production had suffered serious damage from an unforeseen surge in imports, requiring the tariff action. The ITAC based its evaluation on data from AcelorMittal South Africa, which constitutes more than 70% of total domestic production of the affected products.
South Africa will consult with other WTO members on the proposed tariff, which was announced in the same week that the South African steel industry was notified that it would be investigated by the U.S. Department of Commerce. This investigation will form part of an international examination of whether U.S. imports of carbon and alloy steel wire rod from certain countries are being dumped and/or subsidised.
The countries under investigation include Belarus, Italy, South Korea, Russia, South Africa, Spain, Turkey, Ukraine, the United Arab Emirates and Britain. The subsidisation probe covers those from Italy and Turkey, the Department of Commerce said in a statement.
This action follows petitions from Gerdau Ameristeel US Inc, a subsidiary of Gerdau SA, Nucor Corp, Keystone Consolidated Industries and Charter Steel. Reports indicate that the estimated imports of carbon and alloy steel wire rod were valued at an estimated $10.4 million from Belarus; $12.2 million from Italy; $45.6 million from Korea; $32.3 million from Russia; $7.1 million from South Africa; $40.7 million from Spain; $41.4 million from Turkey; $55 million from Ukraine; $7 million from the United Arab Emirates; and $20.5 million from the United Kingdom in 2016.
The U.S. International Trade Commission is due to make a preliminary finding by May. Should it find that the imports cause damage to U.S. producers, the investigations will continue.