SA steel makers look to EU for export relief
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Industrial Correspondent
THE European Union (EU) market appears set to provide muchneeded relief for SA steel makers, who are facing a tough time in SA and other major markets.
Iscor and Highveld Steel & Vanadium will be able to export products to the EU free of duty from next year, through the SAEU free trade agreement.
In addition, there is speculation that the EU is considering lifting hefty antidumping duties on hot-rolled coil from SA. A 5,2% antidumping duty and 0,5% import duty are in place for SA hotrolled coil imports into the EU.
Improved conditions in that market could counterbalance the effects that declining domestic demand, strong rand, and soft price in the US, among other things are expected to have on earnings. Highveld Steel & Vanadium warned earlier that it may have to cut production.
Iscor said the possibility that the EU may lift antidumping duties on hot-rolled coil, would "improve their competitiveness in the European steel market".
On-line publication Steelvillage has reported rumours that EU companies were "seriously considering" lifting the duties.
Iscor spokesman Phaldie Kalam said if this were to happen, exporting hot-rolled coil into the EU would eliminate a major cost factor in the product price.
Kalam said that any positive developments in Europe would be welcomed as steel exports from SA to the US fell from about 265000 tons in 2001 to 244000 tons last year.
Kalam said the introduction of steel trade protectionist measures in terms of Section 201 had created an artificial shortage in the US market, which fuelled the rise of steel prices.
SA escaped the brunt of the Section 201 protectionist measures because of its status as a developing nation in terms of the World Trade Organisation rules.
Kalam said domestic steel producers would have to "maintain disciplined export behaviour into the EU by ensuring that steel import threshold levels are not exceeded".
Iscor and Highveld both closed unchanged at R15,50 and R14,50 respectively on the JSE Securities Exchange SA yesterday.
Jul 08 2003 08:11:45:000AM Carli Lourens Business Day 1st Edition
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