SAISC warns of steel tariffs causing supply shortages, asks for delayed implementation

The Southern African Institute of Steel Construction (SAISC).has raised the alarm about unintended consequences caused by the recent implementation of anti-dumping tariff measures on selected steel imports.

Industry feedback indicates that steel merchants and service centres are already cancelling or delaying import orders in response to the sudden tariff implementation, the Institute says.

At the same time, certain locally produced steel products are no longer available at previous volumes.

This creates a real risk of supply shortages in the market, particularly in specialised sizes and specifications not readily available locally, says Amanuel Gebremeskel, CEO of SAISC.

“If not carefully managed, these measures may increase project costs, delay infrastructure delivery, and reduce the competitiveness of South African exports - outcomes that run counter to the intent of supporting a stable and competitive local steel industry.”

SAISC has recommended that consideration be given to a phased or delayed implementation of the tariffs, allowing the market to adjust without disrupting supply chains or ongoing projects.

Talking to Stephen Grootes, Gebremeskel emphasizes that the statement released by SAISC is not a criticism of the tariffs, which are meant to protect the local industry, but raising the problem caused by the timing of the implementation.

"In general, as the Institute we are very supportive of all measures taken by ITAC or dtic (Dept. of Trade Industry and Competition) to support local indsutrailation in our sector. The market for our industry which is typically structural steel, is infrastructure, mining, bridges, things like that... and Eskom has been releasing a number of new transmission lines recently and there's increased demand..."

"... so we were looking forward to a year of getting busy, preparing over the past two years for what ArcelorMittal's been telling us about the closure of one of their plants for long products and part of that of course involves getting all the service centres and merchants to find ways to make sure that there's no shortage of steel to complete this project."

While SAISC does not typically get involved with the prices on projects, right now they are very concerned with the quality and availability of steel.

What they're looking at in terms of a tariff delay is the need to satisfy immediate demand, basically the next six months, Gebremeske says.

"The one large 'mini mill' which uses recycled steel that is coming online locally, has not yet started making the larger sections and they say they're going to get started only in about six months as well."

"It's a bit of an emergency because many projects are facing a severe shortage of materials at this moment."

For more detail, listen to interview audio at the top of the article