Bangladesh Re-rollers Resist Imported Billet on Possible Duty Hike

Bangladesh based re-rollers avoid importing billet on anticipation that government may increase import duty on it by USD 25-30/MT in annual budget.

Bangladesh’s government had raised import duty on MS billet by USD 20/MT (i.e. 1,500 Bangladeshi Taka) in last budget. The re-rollers here, are anticipating the same for this budget also, which is about to announce in the first week of Jun’15.

According to markets’ anticipation, the government may increase import duty to USD 90-95/MT in upcoming budget, in order to promote steel-making in the country. Currently, import duty on billets is USD 65/MT (i.e. 5,000 Bangladeshi Taka).

“Offers at Bangladesh for containerized shredded 211 scrap is at around USD 305/MT, whereas billet at USD 370/MT, CFR Chittagong basis. You can see some bookings taking place for scrap, but for billets, nothing such is about to happen, as all major player have already concluded their deals anticipating the changes in duty”, said a manufacturer based in Bangladesh.

Bangladesh is one of the major importer of billets in Asian region. It imports around 1.5-1.75 MnT billet annually to meet the country’s demand.

Re-rolling mills consuming greater volume of billets are strongly in favor of lowering duty on billet, while some local producers of billets want that the duty be hiked further to protect the domestic industry.

Indian Billet Exports will be Hampered

India billet exports will definitely get hampered if Bangladeshi government increases import duty, as it is one of the important export market for billet in India. In the recent export tender of bloom floated by Vizag Steel, the entire lot went unsold, sending a clear message that traders were not willing to take positions amid uncertainty.

Global billet Offers as on 29 May’15

Source: SteelMint Research

1 USD = 77.84 BDT (Spotted on 29 May, 2015)