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Indian Steel Association urges govt action amid surge in Chinese imports
Industry News- Oct 16,23
Alok Sahay, the secretary general of the group representing India's steel producers, emphasised the need for systemic changes.
Concerned about a surge in Chinese steel imports, the Indian Steel Association (ISA) is gearing up to address the issue with the government and advocate for corrective actions to rectify "trade distortions."
Alok Sahay, the secretary general of the group representing India's steel producers, emphasised the need for systemic changes. He pointed out that implementing any trade measures takes a minimum of 15 months due to India's lesser duty rule, making the country vulnerable to such situations. Sahay stated, "We are planning to communicate our concerns to the government regarding this issue."
He stressed the importance of countering trade distortions created by exporting countries promptly and effectively to ensure a level playing field.
ISA's data revealed that India imported 570,000 tonnes of Chinese steel in April-July of the fiscal year 2023-24, marking a significant increase of 63% compared to the same period the previous year. Imports from Korea, on the other hand, decreased by 4% to 685,000 tonnes. The ISA's data source, the Joint Plant Committee (JPC), is authorised by the government to collect statistics on the Indian iron and steel industry.
The drop in steel demand in China, due to challenges in the country's property market, led to increased production. India's economic growth provided an opportunity, resulting in a surge in steel imports from China. Global steel production stabilised, but China's production increased by 2.5% to 627 million tonnes from January to July 2023.
Jayant Acharya, Joint Managing Director and CEO of JSW Steel, highlighted the muted domestic demand in China, which led to higher steel exports from China. He expressed concern about India being vulnerable to increased imports at unfair prices despite being one of the few bright spots amid a weak global economic outlook.
Indian companies reported that Chinese imports were affecting steel prices. Data from SteelMint indicated a decline in the average monthly price of hot-rolled coil (HRC) ex-Mumbai, a benchmark for flat steel, from Rs 59,938 per tonne in April to Rs 55,500 per tonne in July.
Ranjan Dhar, Chief Marketing Officer at ArcelorMittal Nippon Steel India (AM/NS India), emphasised that Chinese mills were expanding their presence in traditional export markets and flooding the Indian market with products at lower prices. He urged the government to consider implementing quotas for countries with free-trade agreements (FTAs) and imposing anti-dumping duties on imports from countries without FTAs to address this situation.
The subdued global demand for steel further exacerbated the concerns of Indian steelmakers. Finished steel exports from India in April-June decreased by 6.4% compared to the same period the previous year, with flat products experiencing a 0.3% decline.
Sahay emphasised that without a stable trade environment, investments in the sector would be adversely affected. Indian steel companies were set to increase their capacity by approximately 30 million tonnes between FY24 and FY26.
Acharya noted that the European Union and the US had implemented safeguards, but India lacked effective trade measures, leaving the country exposed. He urged the government to establish safeguard mechanisms to protect Indian steel investments.
ICRA’s Roy pointed out that when India imposed anti-dumping duty measures in 2016, steel imports from China decreased, and the share of FTA countries like Korea and Japan increased. However, the anti-dumping duty was withdrawn in 2021, possibly contributing to the rise in imports from China.
Source: Business Standard
Indian Steel Association
Chinese Steel Imports
Anti-Dumping Duties
Global Steel Production
Alok Sahay
Joint Plant Committee
Jayant Acharya
SteelMint
Ranjan Dhar
ArcelorMittal Nippon Steel India
European Union
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