The Egyptian authorities have recently made an amendment to the earlier introduced additional 10 percent import tax valid for a wide range of products, including finished steel. The move has resulted in a dispute between the government and end-users, specifically those operating in the flats segment. The duty will have had a significant effect on their costs and profitability, as SteelOrbis reported earlier. With the recent amendment, it was decided to provide an exemption to manufacturers and fabricators, including re-rollers, pipe-makers, service centers, and home appliance and engineering companies, the official paper indicates. “This range of the exempted buyers will include pretty much all importers in Egypt, even traders with cutting lines would count,” a trader said.
The development will surely speed up first of all hot rolled coil (HRC) imports to Egypt, which have been stalled for the past couple of weeks. CIS-based and Turkish mills will benefit the most due to their geographical proximity. “It is good that sellers will have another alternative in the region - the CIS other than Turkey and Turkey some place other than the EU, which is tough now,” a source told SteelOrbis.
The amendment involves not only flat steel but also long steel. However, for rebar and wire rod no major effect is expected as the segments are already well protected by 25 percent safeguard duty. Some opportunities, however, may exist for profile and section importers.