The International Trade Administration Commission of South Africa (Itac) has declined to create a rebate provision for copper sulphate used in the manufacture of animal feed, concluding that the domestic market is already served by a local producer with sufficient capacity.

Itac initiated the investigation following a request from Trade, Industry and Competition Minister Parks Tau, who raised concerns that the recent duty increase on copper sulphate from 0% to 10% could have unintended consequences for the animal feed industry, which relies on the chemical as an input.

According to Itac, copper sulphate is used in the animal feed sector to support growth, immunity and productivity in livestock, although its use is significantly lower than primary feed components such as maize and soybean oilcake.

During its review, the commission identified Kimleigh Chemicals as the only known domestic manufacturer of animal feed-grade copper sulphate and Itac considered the company’s information as being representative of the domestic supply side of the industry.

Itac reported that Kimleigh was compliant with all legal requirements and holds valid registration to produce, sell and market animal feed-grade copper sulphate.

An assessment of national import volumes, together with Kimleigh’s installed and spare production capacity, showed that the company’s output potential significantly exceeded the total amount of copper sulphate imported into South Africa. Based on this analysis, Itac concluded that the producer is capable of meeting the country’s demand for animal feed-grade copper sulphate.

The commission stated that it, therefore, saw no basis to introduce a rebate system, which would have allowed animal feed manufacturers to bypass some or all of the import duty.

Such rebates are typically used to help industries secure inputs at globally competitive prices, but Itac found that the existence of an established and sufficient domestic supplier meant that a rebate was not warranted in this case.