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Cape Town - The Department of Trade and Industry will make sure South Africa preserves its primary steel-making capacity, Trade and Industry Minister Rob Davies said on Wednesday.
Briefing the media ahead of his department’s budget vote in Parliament, Davies said South Africa, like the rest of the world, faced enormous challenges amid the global gut in steel prices.
“No steel producer anywhere in the world has an easy choice around the fact that prices are way below production costs. Our objective is to come out of this situation with our primary steel-making capacity still in tact.”
Davies added that announcements regarding tariff decisions would be made at a later stage, but steel price increases could not be to the detriment of downstream steel manufacturers in South Africa.
He emphasised that it was not an option for South Africa to merely be a net importer of steel.
“I can’t think of any industrial economy that doesn’t have a steel-making economy. We’re an iron-ore producing country, it won’t make any sense to be dependent on imports and at the vagaries of international steel markets.”
In August last year, Davies came to the rescue of the steel industry by approving a 10% ad valorem duty on some imported steel products on condition that steel producers didn’t increase prices that were subject to the duty.
