Thursday, March 12, 2015

India plans anti-dumping duty on some steel from China, others 
[Editor: This was long overdue and I am anticipating positive moves from the FMO. But I want a blanket increase in import duty regardless of the type of steel / ferro alloys. If some countries are constantly dumping in India due to slump in sale in their own markets, then India has to take immediate measure to arrest such imports. Now from tomorrow the price of most of the steel stocks are expected to move up on the twin reason: (i) Passing of Land Reform Bill in the Lok Sabha and (ii) trade ministry recommending anti-dumping duties for some industrial grade stainless steels. I have already recommended the name of Rohit Ferro Tech Ltd (Rs.7.91) which is a producer of various grades of stainless steels: 
  • Austenitic
  • Ferritic
  • Martenistic
  • Austenitic-Ferritic grades
  • Stainless Steel with special grades of Precipitation hardening, Cold heading and Electrode quality etc
Another of my earlier recommendations, Jai Balaji Industries Ltd (Rs.12.21) could also be benefited to some extent, as it is one of the largest manufacturers of Ferro Alloys in Eastern India. It has a production capacity of 1,06,000 MTs per annum which includes 5 Submerged Arc Furnaces in Durgapur, West Bengal; two 9 MVA Furnaces and three 16.5 MVA. 
In the current set up the concentration is on production of manganese based Ferro Alloys such as Ferro Manganese and Silico Manganese. Bulk Ferro alloy as per International / Indian Standard Specification used to manufacture mild steel, alloy steel and stainless steel]
NEW DELHI, 11 Mar, 2015: The trade ministry has recommended anti-dumping duties ranging from $180 to $306 per tonne for some industrial-grade stainless steel imported from China, Malaysia and South Korea in a bid to protect local industry. 

After a year-long investigation based on complaints from Jindal Stainless Ltd, the trade ministry said it found that the domestic industry was suffering "material injury due to such dumped imports" and that a definitive measure was required to stop it. 

The recommendations, made public on Wednesday, are expected to be implemented by the finance ministry within three weeks and will stem the flow of surging imports, NC Mathur, president of the Indian Stainless Steel Development Association, said. 

Mathur said the grades subject to the dumping duty can cost $1,270-$2,070 per tonne and are used mainly to make equipment for industries like dairy, oil refinery and railways. 

India consumes about 1 million tonne of this type of stainless steel and more than 40 per cent of that is imported, mainly from China, a trade which is growing at up to 15 per cent a year. 

China's annual stainless steel surplus is more than 4 million tonnes, compared with India's annual demand of about 2.6 million tonnes and which leads to cheap supplies coming in from China, Mathur said. 

Steelmakers from Asia to Europe are facing increasing pressure from a rise in cheap imports as Russia and Ukraine, armed with weaker currencies, join China in pushing surplus output on to world markets. 

Jindal Stainless shares ended up 10 percent at 40.50 rupees on Wednesday on the duty recommendations, their highest closing price in 2.5 months. 

Mathur said the steel industry also welcomed the government's decision to provide for an increase in the import duty on steel to 15 percent without any major procedural delays. Earlier, the government had set a limit of 10 per cent while the actual duties are below that. 

The provision will allow the government to raise the duty whenever it wants just with a notification, Mathur said. 

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