India: Flat Steel Manufacturers optimistic on Import Duty hike

Indian Flat Steel manufacturers have expressed their confidence on the recent proposals of the Steel Ministry to raise import duty on HR Coils from 7.5% to 10%. Talking to an exporter in India, SteelMint learnt that domestic manufacturers are so optimistic of this duty hike that they are currently not offering any HRC for exports as of now.

Last export deals of HRC were settled at USD 460-470/MT, FoB West Coast India. Falling prices in the international market have led to lower export realizations for Indian manufacturers, who are also struggling to maintain pricing power in the domestic market.

Price in USD/MT

Lower prices in international markets have led to significant rise in imports of countries like India, Thailand, Turkey including others. This glut of cheaper HRC products has forced countries like Thailand, Vietnam to impose safeguard/anti-dumping duty to protect the interest of their domestic Steel industry. Experts believe that it is highly essential for India to re-look at its duty structure and trade pacts to safeguard its industry.

Data available with SteelMint inferred that HRC offers from China and Russia have seen the steepest fall in the last 1-month, thereby building pressure on domestic prices. The increase in import duty will certainly help domestic manufacturers to retain their pricing power.

Trade sources confirmed that imported HRC from Russia was offered at around USD 440-450/MT, CNF India in mid Jan’15. Whereas, this offer was at around USD 470/MT levels in mid Dec’14. Chinese HRC offers in the market were reported at USD 450-460/MT, CFR India levels.

Source: JPC