ERG Industrial (Pty) Ltd applied for a duty reduction, from 20% ad valorem to free of duty, on “stemming plugs for mining and civil blast holes”, classifiable under the new tariff subheading 3926.90.90.
Reasons for the application
- There is no manufacturing industry for the product in the SACU;
- To satisfy the demand for such a product and create a rapid expanding market and industry within South-Africa; and
- To contribute to overall South African economic growth.
There is no SACU producer because it is a new product in the market, designed to provide aid in the stemming process used within the mining quarrying and construction industries. Stemming is the process in which material is placed into a bored blast hole on top of the explosive charge in order to contain or confine the explosive energy.
Stemming plugs provide additional resistance/confinement which enables more explosive energy to be transferred into the rock body, resulting in an improved fragmentation (breakage) of the rock body and less ejection of the stemming material.
Trade restrictions should be omitted in order to give stemming plugs fair market access to satisfy demand and improve manufacturing in several industries. The reduction of this duty will cause no harm to the SACU industry since:
- It is a new product to the market with no competing SACU manufacturer;
- This product does not replace an existing product, it is simply an addition to the stemming process and;
- Mining, quarrying and construction industries can benefit from the product by obtaining more value from their operations.
Since stemming plugs have not been used in large scale in industry yet, it makes perfect sense to give this product unobstructed market access to make a difference in the mentioned industries, especially mining, to accomplish economic growth.
Interested parties have until 21 May 2021 to respond.
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