India lifts export duties on steel products and iron ore

The Indian government's move to remove export duties on steel could allow plants to increase capacity utilization, although exports and prices will be driven by demand.

Tariffs pushed India's finished steel exports down in October to a more than three-year low of 360,000 tonnes, also down 66% from a year earlier. Exports in April-October decreased by 55% compared to the same period last year to 3.96 million tons, according to the Joint Mills Committee under the Indian Ministry of Steel. In October, India also became a net importer of steel for the second time in four months.

“The fundamentals in India are much better, so we would definitely like to focus on the domestic market, but at the same time, the excess capacity that is available and underutilized will help us be more cost effective and keep us able to serve any international demand that could arise,” said a senior official at a major domestic steel producer.
“General sentiment will improve and global markets will start looking towards India again,” the official added.

Iron ore
The government also abolished the export duty on lumps and fines of iron ore with an iron content below 58% and iron ore pellets from the previously imposed duties of 50% and 45%. Iron ore lumps and fines with an iron content above 58% will continue to be subject to a 30% duty, as they were before the May announcement of duties.

“This is a very good event. Exports are helping the iron ore industry, especially low grades that are not used in the country's steelmaking,” said R.K. Sharma. But it will take some time to revive the market amid oversupply in the global iron ore market and a weak Chinese economy, he added.