Bangladesh – one of the emerging economies observed sharp increase in bulk scrap and HBI imports in its FY17 (Jul’16-Jun’17). On the other hand country’s billet imports have reduced sharply in last fiscal.
According to provisional customs data maintained with SteelMint, total bullk ferrous Scrap imports in Bangladesh hiked by 42% Y-o-Y to 803,014 MT in FY17, which was just 469,010 MT in FY16. On similar lines, HBI imports to Bangladesh went up by 24% Y-o-Y to 269,860 MT in FY17 against 204,300 MT in previous fiscal.
However, total imports of billet in Bangladesh declined sharply in FY17 compared to previous fiscal. 352,800 MT billet was imported to Bangladesh in FY17 against 992,180 MT in FY16.
Changes in duty structures and agreements were the reason behind fall in billet export and cheaper scrap offers resulted in increase in scrap imports. SAFTA agreement between SAARC nations expired on 31 Dec’16 which was later extended. Billets attracted a regulatory duty of 20% at a tariff value to USD 400/MT and 15% VAT before budget, in the budget announced on 01 Jun’17 this has been kept unchanged. On the other hand Specific duty on scrap imports which was at Taka 1500 before budget has been replaced with 5% regulatory duty and 15% VAT.
Bangladesh is one of the fastest evolving countries in ferrous scrap market. Bangladesh has an installed steel capacity of around 3.5 MnT, which is expected to increase to 5 MnT in coming years. This will further boost scrap imports to the country.
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