The share price of Pietermaritzburg-based aluminium group Hulamin shot up on Thursday after the company said it was unfazed by the hefty tariffs imposed two weeks ago by US President Donald Trump in his crackdown on imports into the world’s largest economy.
Trump announced this month that he planned to impose a 25% tariff on all imported steel and aluminium in a bid to boost American producers in a move that will spike the costs of soft drinks and beer and many everyday grocery items sold in steel and aluminium cans.
The new tariffs extend the 2018 Section 232 tariffs, initially implemented to protect domestic steel and aluminium makers on national security grounds.
Hulamin said, however, that it will not be affected materially by the new tariff, a conviction that sent its share price up more than 10% on the day.
The company said it derives about 11% of its rolled products volumes from exports to the US.
“Hulamin’s view is that the duties announced on February 10 2025 will have no impact on Hulamin’s competitive position in the US market as all its competitors will be subject to the 25% tariff. As the countries’ exemptions to the s232 duties will be removed, Hulamin’s competitive position will improve,” the company said.
“Accordingly, the expectation is that volumes going forward supplied to the US and the margins achieved thereon will remain unchanged. The imposition of tariffs by the US is a dynamic situation and future changes in the US tariff regime could impact on the view expressed above,” it said.
Hulamin buys primary aluminium and supplies a range of high-value, niche rolled products and complex extrusions. Aluminium rolling, the uses of which include cans, accounts for most revenue.
Aluminium is used in a wide range of forms and products: in buildings, boats, planes, trains, trucks, cars, household appliances, packaging, computers, cellphones, solar farms, electrical transformers, overhead power lines, tamper proof packaging for medicines, containers for food and beverages.
Hulamin said its exports to the US were historically subject to import duties which comprised a base duty, a Section 232 duty (s232 duty) and an anti-dumping duty.
“The s232 import duties were initially imposed in 2018 at a flat rate of 10% on all imports into the US. After the imposition of the s232 duty several countries, including the EU, Japan, Mexico and Canada, received an exemption from this duty,” it said.
“Aluminium imports from exempted countries were subject to a nil percent duty in terms of s232. Hulamin was subject to the 10% flat rate duty introduced in 2018.”
Business Leadership SA CEO Busisiwe Mavuso on Monday warned that tariffs will put US-SA relationships under strain.
“Steel and aluminium account for about 8.5% of what we export to the US so the 25% tariff will put pressure on those volumes, though they account for 0.3% of all our exports,” she said.
JSE-listed Hulamin in August outlined plans to invest R500m over the next two years in developing its wide can-body capacity to capitalise on the growing can market in its domestic market.
Under the leadership of CEO Mark Gounder the company has pivoted its strategy from being a lead exporter to a main supplier to the local market.
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