ITAC self-initiated an investigation into the possible creation of a rebate provision for copper sulphate used in the manufacture of animal feed, following a request by the minister of trade, industry and competition, due to concerns about the unintended consequential impact the duty increase from 0 to 10% ad valorem may have on the animal feed manufacturing sector, who use copper sulphate in their production processes.
During its deliberations, the Commission found that:
• Copper sulphate is an input in animal feed, supporting growth, immunity, and productivity in livestock. Its usage is significantly lower compared to key inputs such as yellow maize and soybean oilcake.
• Kimleigh Chemicals SA is the only known domestic manufacturer of animal feed-grade copper sulphate in South Africa. The company is registered with DALRRD under Act 36. Accordingly, Kimleigh’s information was considered representative of the domestic supply side of the animal feed-grade copper sulphate industry.
• According to information available to the Commission, Kimleigh was compliant with the requirement under Act 36, and holds a valid registration with DALRRD, in terms of Act 36, to produce, sell, and market animal feed-grade copper sulphate.
• An analysis of the total import volumes of copper sulphate and Kimleigh’s installed and spare production capacity revealed that the company’s capacity significantly exceeds the volume of copper sulphate imported into South Africa, indicating its potential ability to meet domestic demand for animal feed-grade copper sulphate.
The Commission decided not to create a rebate provision for copper sulphate used in the manufacture of animal feed, owing to the fact that there is an established domestic manufacturer with sufficient installed production capacity to meet the domestic demand requirements for copper sulphate.
A rebate facility provides a duty waiver for domestic industries not to pay full or partial customs duties on a specific product. It allows for sourcing of inputs at world competitive prices and promotes competitive pricing in the local and export markets
Please refer to Report 749 for full details.
ISSUED BY THE INTERNATIONAL TRADE ADMINISTRATION COMMISSION OF SOUTH AFRICA