Falling Rupee, customs duty and rising power prices in India will cut short imports of steel scrap in coming months,according to officials at All India Induction Furnace Association (AIIFA). India is third largest importer of scrap with an annual trade of around 8 million tonnes, out of which around 7 million tonnes is ferrous and 1 million tonnes is stainless steel scrap.
According to sources, steel mills based in North India, which holds maximum share in imports have cut down their purchases on falling Rupee (which has hit an all time low of 58.90/USD). Indian steel mills also not capitalizing on falling scrap prices in global market due to weak Rupee.
On the other hand custom duty of 2.5% on all types of scrap, have hurt imports. Most of induction furnaces, which are major consumer of ferrous scrap have either switched to sponge iron or local scrap.
Officials also mention scrap imports may fall up to 6 million tonnes in FY 2013-2014, which had touched over 7 million tonnes in FY 2012-2013.
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