Domestic steel sector hits by moving train post govt’s duty steps
Steel

Domestic steel sector hits by moving train post govt’s duty steps

The domestic steel sector has been hit by a moving train, rating agency Icra said reacting to the duty-related steps taken by the government.

On Saturday, the government increased the duty on iron ore exports by up to 50% and a few steel intermediaries by 15%. It also declared waiving of customs duty on some raw materials imports, including ferronickel and coking coal, utilised by the steel industry.

On Monday, Icra said the steel industry has been hit by a moving train as the government cracks the whip and charges an export duty to reign in raised costs. Nearly 95% of India's finished steel export basket has been hit with 15% export duties.

Domestic steel prices could potentially correct by 10%-15% in the forthcoming months as demand enters the seasonally weak monsoon quarter.

Icra further said expansion plans of many steelmakers could also be affected if the duties are maintained in the medium term.

Jayanta Roy, Senior Vice-President, and Group Head, Corporate Sector Ratings, Icra, told the media that Indian mills registered a 25% year-on-year (YoY) increase in finished steel exports as they took the advantage of raised seaborne prices in FY22. Vietnam, Europe, and the Middle East were the three largest destinations for Indian steel exports, jointly accounting for approximately 50% of India's overall steel exports.

Many of these destinations would become less appealing now as mills estimate the economics of a higher duty. Also, with steel export offers for deliveries to Europe is increased by 10%-11% over more competitive markets like South-East Asia and the Middle East, the negative impact of the new export duties on steel exports to Europe would be somewhat less intense than that of South-East Asia and the Middle Eastern markets, he said.

Image Source

Also read: Govt waives customs duty on imports of certain raw materials

The domestic steel sector has been hit by a moving train, rating agency Icra said reacting to the duty-related steps taken by the government. On Saturday, the government increased the duty on iron ore exports by up to 50% and a few steel intermediaries by 15%. It also declared waiving of customs duty on some raw materials imports, including ferronickel and coking coal, utilised by the steel industry. On Monday, Icra said the steel industry has been hit by a moving train as the government cracks the whip and charges an export duty to reign in raised costs. Nearly 95% of India's finished steel export basket has been hit with 15% export duties. Domestic steel prices could potentially correct by 10%-15% in the forthcoming months as demand enters the seasonally weak monsoon quarter. Icra further said expansion plans of many steelmakers could also be affected if the duties are maintained in the medium term. Jayanta Roy, Senior Vice-President, and Group Head, Corporate Sector Ratings, Icra, told the media that Indian mills registered a 25% year-on-year (YoY) increase in finished steel exports as they took the advantage of raised seaborne prices in FY22. Vietnam, Europe, and the Middle East were the three largest destinations for Indian steel exports, jointly accounting for approximately 50% of India's overall steel exports. Many of these destinations would become less appealing now as mills estimate the economics of a higher duty. Also, with steel export offers for deliveries to Europe is increased by 10%-11% over more competitive markets like South-East Asia and the Middle East, the negative impact of the new export duties on steel exports to Europe would be somewhat less intense than that of South-East Asia and the Middle Eastern markets, he said. Image Source Also read: Govt waives customs duty on imports of certain raw materials

Next Story
Resources

NSL Achieves Record-Breaking Production Milestones on April 26

In an extraordinary demonstration of operational excellence and technological prowess, NMDC Steel Limited (NSL), India’s youngest and modern steel plant achieved multiple record-breaking production feats on April 26, 2025, further reinforcing its emergence as a frontrunner in the nation's vibrant steel industry. The company surpassed its own record-breaking milestones for the third time this month as the steel plant reached its rated capacity, signalling an exceptional momentum for growth. This ability to consistently exceed expectations not only highlights the speed at which it is scal..

Next Story
Resources

REC Limited Successfully Raises Rs 50 Billion Through Bond Issuance

REC Limited, a leading public sector enterprise under the Ministry of Power and a premier non-banking finance company, has successfully raised Rs 50 billion through the issuance of bonds. The offering included Rs 30 billion through 5-year bonds at coupon of 6.87 % and Rs 20 billion through 10-year bonds at coupon of 6.86 %.The bond issuance witnessed an overwhelming response from market participants, reflecting strong investor confidence in the company’s robust financial position and growth prospects.The bonds have been assigned a ""AAA"" rating by prominent credit rating agencies – CARE R..

Next Story
Resources

Fugro Introduces Geotechnical Innovation at IGIC 2025

Fugro, the world’s leading Geo-data specialist, is proud to announce its participation as a main geotechnical sponsor at the second edition of the International Geotechnical Innovation Conference (IGIC) 2025, taking place on May 5 and 6, 2025, in Jeddah, Saudi Arabia. Organised under the theme ‘Shaping the World Beneath: Fostering Sustainability, Innovation and Resilience in Geotechnics,’ the event will convene global experts to explore new avenues in geotechnical engineering and infrastructure development.  At IGIC 2025, Fugro will introduce its GroundIQ™ approach, a revolut..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?