Posted on 01 Aug 2024
India’s Ministry of Steel has called on the Ministry of Commerce and Industry to probe cheaper Vietnam- and China-origin steel imports, according to media reports.
"We have said that the trade ministry should investigate these imports and offer its recommendations to the finance ministry, which will take the final call," a government source is quoted as saying by Reuters.
India was a net finished steel importer in the fiscal year ending March 2024 (FY24). Annual finished steel imports rose by 38.2% on-year to 8.32 million tonnes. Exports grew 11.5% to 7.487mt. It remained a net importer in the first fiscal quarter ending in June 2024 (Q1), with imports up 29.5% y-o-y to 1.86mt, while exports rose 37.7% to 1.28mt, according to provisional Joint Planning Committee (JPC) data.
Neither India’s steel nor commerce and industry ministry responded to Kallanish request for comment on Wednesday. The Indian Steel Association (ISA), which represents domestic steelmakers, also did not reply to a request for comment by deadline.
Market sources note the discussion over rising imports has been ongoing for some time now.
In early July, the steel and commerce and industry ministries were reportedly in talks over rising imports, especially for low-priced product arriving from China (see Kallanish passim).
An Indian domestic trader says import measures could be implemented in the face of rising imports. Another source notes that Indian mills will likely try to push for some form of import measures, since Vietnam recently initiated an anti-dumping (AD) investigation against India and China.
However, another source counters: “Direct import protection will be difficult [to implement] and government should not do this; otherwise, downstream [sectors] will be finished.”
Earlier this week, Vietnam’s Ministry of Industry and Trade launched an AD investigation into certain hot rolled coil originating from China and India (see Kallanish passim).
On Tuesday, Indian steel ministry secretary Nagendra Nath Sinha said at a Bharat Chamber of Commerce (BCC) meeting that steel imports account for only 5% of Indian consumption, but noted that complaints about Vietnam-origin HRC were being taken up by the commerce and industry ministry’s Directorate General of Trade Remedies (DGTR).
Last week, Indian steel minister H.D. Kumaraswamy launched the upgraded Steel Import Monitoring System (SIMS 2.0) portal to help improve steel import monitoring, support the growth of the domestic steel industry and achieve self-sufficiency in steel production (see Kallanish passim).
The current basic customs duty on steel stands at 7.5%, applicable on semis, flat and long products of non-alloy, alloy and stainless steels.
India's steel ministry also called on EU officials not to impose higher taxes on its carbon-producing sectors, in a meeting held with representatives of the bloc in July.
Earlier this week, India rejected the EU’s proposal for higher taxes on carbon-producing industries as part of the Carbon Border Adjustment Mechanism (CBAM).
"Their suggestion is not practical. Their team had come and met us ... The solution they are offering doesn't work for a developing economy like India," Indian economic affairs secretary Ajay Seth is quoted as saying by Reuters.
A steel market participant notes India is unlikely to be able to comply with CBAM rules. An EU-based source concurs, adding that import prices into the EU will need to be cheaper than EU domestic prices, while accounting for roughly €100-200/tonne of taxes. Indian HRC exporters to the EU will thus need to price their coils at a minimum of €100-200/t below local EU prices.
The steel ministry is also reportedly in talks with Indian mills to diversify their coking coal imports from Russia, China and the US. Indian mills consume 70 million tonnes/year of coking coal, of which 85% is imported.
Source:Kallanish
