Imposed in early February to rein in rising imports, the minimum import price (MIP) on steel will likely remain valid for the entire scheduled six-month term as the domestic industry’s present overall situation, though improved, does not support any premature withdrawal of the trade remedial measure, a steel ministry source said.
The government had imposed MIP on 173 steel products in the range of $341 to $752 per ton on 173 steel products for six months to protect the domestic industry from galloping imports from countries like China, Japan, Korea and Russia.
Even as the prices are better now, the industry is far from its desired financial position. Imports also remained unabated. There is no question of withdrawing the MIP at the moment,” said the source.
Chances are also remote of withdrawing it prematurely till its tenure ends in July, another official said.
Steel prices have risen globally since February and in sync with the global trend, domestic firms have also hiked prices of their products. A Credit Suisse report, published on April 19, said that domestic prices have surged $50-60 per ton after the MIP was imposed in February.
“Even though Chinese prices have rallied too (to around $445 per ton now), we think protectionism is here to stay,” it had said.
Imports also remain largely unabated. According to the Joint Plant Committee (JPC), a unit under the steel ministry, imports stood at 0.997 million ton (mt) in March this year compared with 0.84 mt in the same month last year, recording a 18.2% rise. In February this year, India had imported 0.912 mt steel. The price of HR coils, the benchmark steel product, on the other hand, was lower in March at Rs 35,000 per ton in the Delhi market compared with Rs 39,600 per ton in the same month last year.
Steel industry sources said that imports would “definitely” come down in April as most of the transactions were booked earlier than February. Credit Suisse also expects imports to be “meaningfully” lower in April.
Apart from the MIP, the government had tried many tariff and non-tariff trade barriers, but none worked on the expected lines.