Industry News

The South African International Trade Administration Commission has issued notice of a safeguarding investigation against increased imports of hexagon head steel bolts, imported under tariff code 73181543.

The investigation is in response to an application lodged by the South African Iron and Steel Institute on behalf of the South African Fasteners Manufacturers’ Association. SAFMA members, represent 100% of domestic fastener manufacturing.

Injury analysis was submitted by CBC Fasteners (Pty) Ltd, Transvaal Pressed Nuts Bolts and Rivets (Pty) Ltd, and SA Bolt Manufacturers Company (Pty) Ltd, which account for 80% of bolt production in South Africa. The analysis alleges the domestic industry experienced serious injury, between July 2015 and June 2019, in the form of a decline in sales volumes, output, market share, utilisation of capacity, net profit and productivity. The ITC found that prima facie information was submitted to indicate that the South African industry was suffering serious injury which could be causally linked to the surge in the volumes of imports.

The application cites China as leading the “confluence of events” forming the basis of “unforeseen development” (as defined by the Uruguay Round of GATT negotiations), resulting in the injury. These events included:

• The unprecedented steep rate of increase in global fastener production capacity, increasing eight-fold since 1994, to support growing construction, manufacturing and infrastructure activity, particularly in emerging economies;
• The contraction of the world economy and in particular the Chinese economy resulting in the contraction of demand for fasteners, contributing to an imbalance between capacity and demand.
• Record export volumes by countries with excess capacity, especially China fuelled by excess capacity and output.
• Excess output, capacity and export volumes led by China, displacing production in other regions, harming producers. This led to trade protection actions by major fasteners markets, which contracted global fastener demand further, exacerbating the problem of increased imports into the South African market.

The notice called for interested parties to submit information within twenty days. The South African Government has notified the WTO of the safeguarding investigation. A full copy of the notice is available here.