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Engineering goods exporters seek govt intervention to bring domestic steel prices down

Our Bureau New Delhi | Updated on August 20, 2020

Say local steel makers have raised prices across categories following the levy of anti-dumping duties on steel imports from China, Vietnam and South Korea

Engineering goods exporters have voiced their concern against rising domestic steel prices following the imposition of anti-dumping duties on steel imports from China, Vietnam and South Korea earlier this year which they say was rendering their shipments non-competitive in the global market.

Immediate intervention of the government has been sought by the Engineering Export Promotion Council of India, the representative body of engineering goods exporters, to check the sharp increase in steel prices, according to an official release of the council circulated on Thursday.

“In the backdrop of restrictions on imports from China, Vietnam and South Korea, Indian steel makers have raised the prices across different product categories, making the raw material cost for user industries sky-high and leaving the engineering exporters non-competitive in the international market,” the release said..

The price rise

As per figures collated by EEPC, steel firms have increased the prices of hot-rolled coils by ₹700-750 per tonne on an average in July 2020. For cold-rolled coils, prices have increased by ₹500-550 per tonne. Prices for steel pellets have gone up by ₹300-350 per tonne and for iron ore fines and lumps prices are higher by ₹200-250 per tonne. Pig iron and steel prices, too, have increased by ₹3,000/tonne in the local market.

In June this year, the government imposed anti-dumping duty on imports of certain types of steel products from China, Vietnam and South Korea for five years. The duties imposed are in the range of $13.07 to $173.1 per tonne on imports of flat rolled products of steel, plated or coated with alloy of aluminium and zinc.

“The price rise needs to be contained so that the benefits of ‘Aatmanirbhar Bharat’ are shared widely with the MSME manufacturing exporters and not pocketed by large steel makers”, the release said, adding that engineering exporters contributed more than 25 per cent to the entire basket of Indian exports.

The release further pointed out that the protection against imports was largely accruing to steel makers at the cost of engineering units, particularly those in MSME sector, who have suffered the most under the the Covid-19 impact.

Production drops

Major steel producing countries barring China are experiencing a decline in production, as per industry figures. India produced 6.9 million tonnes (mt) of crude steel in June 2020, down 26.3 per cent from that in June 2019. Japan produced 5.6 mt of crude steel in June 2020, down 36.3 per cent from a year ago, while South Korea’s steel production in June declined by 14.3 per cent to 5.1 mt.

Published on August 20, 2020

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