Steel manufacturer ArcelorMittal Nippon is keen that the Centre should impose the proposed safeguard duty on steel products as soon as possible, so as to protect against any dumping onslaught from China, Ranjan Dhar, Director & Vice President (Sales and Marketing), AM/NS India said on April 16.
“We are seeing over-capacity in China, which has produced about 1 billion tonne of steel, while their domestic consumption has not kept pace with the production. Last year, China exported 110 million tonnes of steel, and the countries they were traditionally exporting steel to have now developed their own steel manufacturing capacities such as Vietnam, Indonesia, Malaysia. So, the threat of dumping into India looms large despite the existing tariff barriers, especially under the current scenario, where Chinese exports to the US will come to a halt,” Dhar told Moneycontrol on April 16. AM/NS India is the India joint venture of the world's second largest steelmaker ArcelorMittal.
Last month, the Directorate General of Trade Remedies (DGTR) had recommended a 12 percent provisional safeguard duty, ad valorem for 200 days, on select steel products, which is yet to be implemented.
Safeguard measures are used in times of ‘increased, unfavourable and unforeseen imports’ that cause or threaten to cause ‘permanent damage to the domestic industry’, the Commerce Ministry had said.
On the ongoing tariff war, Dhar said steel companies such as AM/NS operate on tight margins, which need to be protected for investments to continue in the sector. “If margins are not protected, then banks won’t give money for investments, and then all our plans for green steel and capacity addition will be hit,” he added.
On April 16, AM/NS announced plans to target 70 percent green output by FY27. By then, its total production is projected to shoot up to 15 million tonnes per annum (MTPA) from the current 9 MTPA. Of the total figure, about 35-40 percent will be automotive focused, up from the current 18 percent, Dhar said.
On the sector’s growth outlook, he said crude steel production growth in the current financial year will be similar to FY25, at 4.8-5 percent, while the demand growth is pegged at about 8 percent.
Read More: ArcelorMittal Nippon gets import exemption for key raw material despite curbs
India’s steel import rose by 20 percent last year while prices slipped to multi-year low. Dhar said a relief from government is necessary for the industry to recover and re-invest. According to Bloomberg News, Chinese crude steel output rose in March despite the government's pledge to address China’s supply glut with output cuts.
“Overall, the export outlook is weak. All our focus of investment is domestic and anyway, currently export opportunities are low. We would prefer export of goods of steel from the country, not of steel per se,” he said.
Steel and aluminium articles, and automobiles and auto parts are already subject to import tariff at 25 percent rate in the US.
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