Govt cuts import duties on steel, metcoke

Import duty on prime steel, except alloy steel & stainless steel, cut to 15%.

While duty on pig iron and sponge iron has been reduced from 15 per cent to 10 per cent; metallurgical coke (metcoke) duty has been cut from 10 per cent to 5 per cent.

The notification comes just days after the country's leading hot rolled coil manufacturers raised prices by up to Rs 4,000 per tonne (around 17 per cent) citing spiralling input costs, especially metcoke.

In the past few months, metcoke prices have shot up from $80 per tonne to $400 per tonne.

Leading steel producers said the cut in import duty would help stabilise prices of hot rolled coils in the country. "Being a large domestic player, we have taken steps to make steel available in the country. The latest decision will stabilise prices in the market," Steel Authority of India Ltd Chairman V S Jain said.

Confederation of Indian Industry President Anand Mahindra added: "The duty cut will not only reduce the cost of steel but also increase the efficiency and competitiveness of the domestic steel industry."

Ispat Industries Executive Director (marketing) Vinod Garg said the lowering of import duty on metcoke would help the company pare its hot rolled coil prices by Rs 500 per tonne.

However, downstream users are not sure whether the duty cuts will lead to a fall in steel prices. Calling the cut insufficient, S C Mathur, president of the Cold-rolled Steel Manufacturers' Association, said the announcement fell short of the association's demand for duty-free import of hot rolled coils given a shortage of 1.5 million tonnes in the domestic market.

Meanwhile, leading steel producers, during their meeting with Union Minister of Steel B K Tripathy, demanded the removal of the 5 per cent import duty on scrap, a ban on export of iron ore and a reduction in excise duty on steel from 16 per cent to 8 per cent, to check the rise in steel prices.