Export duty hike to soften steel prices

New Delhi: Steel product prices, which were continuously rising in the domestic market, are expected to fall by 10-15 per cent due to duty-related measures taken by the government, industry body Engineering Export Promotion Council (EEPC) on Monday said.

Reacting to the government's move to levy export duty on some steel items, EEPC India Chairman Mahesh Desai said engineering goods manufacturers and exporters would benefit from the move and become more competitive in the global markets. "Downstream exporters feel primary steel products prices will fall by 10 per cent for primary producers and 15 per cent for secondary steel producers," he said in a statement.

On Saturday, the government announced waiving of customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry. Also, the duty on exports of iron ore was hiked by up to 50 per cent and a few steel intermediaries to 15 per cent. "The government's decision to remove import duty on raw materials for steel would lower the cost for the domestic steel industry and therefore lower the prices...(and) increase/imposition of export duty on iron ores and a host of steel intermediaries would increase the domestic availability of the key industry inputs," Desai said.

The reduction in auto fuel prices would ease logistics costs, which have been hurting the sector for quite some time, he added. "All the steps together would not only help the industry beat the surging input costs but also improve liquidity. We welcome the government decision and greatly appreciate the timely response," Desai said. Meanwhile, Kamal Aggarwal, the Secretary-General of All India Induction Furnaces Association (AIIFA), told PTI that the prices of TMT have already started coming down.