Indian government considers reducing steel exports

Indian government considers reducing steel exports

Indian government is contemplating to curtail export of steel as well as iron ore from the country, after reducing the import duty on prime steel, pig iron, sponge iron and metallurgical coke. Steel Minister BK Tripathy stated that the government is looking for the option of canalizing the export of lower grade iron and start negotiations with China for soaring the supply of metallurgical coke for Indian steelmakers. Moreover, the government is also seeking the possibility of entering into a barter deal with major coking coal exporters like China and Brazil. Indian steel producers have been asking a restriction on iron ore exports in order to bargain with China for better metallurgical coke prices. Metallurgical prices have increased from around $80/ton to over $400/ton in the last few months. Government officials expressed that metallurgical prices are higher than steel prices. BK Tripathy also said that the government can implement a surcharge on steel exporters, if prices do not stabilize soon. However, Indian major steelmakers like SAIL and Tata Steel have pointed out that the sharp increase in prices is only a reflection of the prices in the international market. The steelmakers also attributed the price increases to strong demand especially from China and the continuing shortage of raw materials such as coking coal and scrap. Meanwhile, Commerce and Industry Ministry officials are working out ways to reduce exports and increase domestic supply of steel. This issue will be discussed with Steel and Finance Ministers in the next couple of days.