Govt hikes import duty on steel products to stop China dump

Yielding to steel ministry requests, the government on Wednesday hiked import duty on long steel products from 5.5 percent to 7.5 percent and that of flat steel product from 7.5 percent to 10 percent. The import duty on stainless steel products remained unchanged.Alarmed by the excess steel capacity in China that was leading to dumping, Steel and Mines Minister Narendra Singh Tomar had pressed the finance ministry to raise import duty as a measure to safeguard domestic industry. 

Imported landed costs for flat steel will now stand at Rs 27100/tonne from 26500/tonne. JSPL, SAIL, JSW Steel and Tata Steel will benefit from the import duty hike on steel products.

Welcoming the decision, Uttam Galva MD Ankit Miglani said the move will bring relief to the industry. In flat products it will have an impact of about Rs 1,000/ tonne on cost and that will be quite a requirement today to maintain sustainability, he said. He ruled out the possibility of price increase in the domestic market. "But given the fact that we are entering off-season and there is a lot of pressure on the market, it (the decision) will allow the Indian steel companies to maintain the existing prices," he told CNBC-TV18.

Also GD Mundra, Director of Sarda Energy and Minerals said the import duty has been revised up by 2.5 percent but the difference in the price of the imported material and the domestic material at the port level is around 5-7 percent. However, to some extent it's a relief to domestic industries with the rise in import duty by 2.5 percent, but I do not think that will have very much impact on it.