The government’s decision to remove export duties on steel and associated products will be positive for the entire ferrous pack from a medium to long-term perspective, according to analysts.
However, they expect no near near-term benefits as international prices are much lower than domestic prices. Also, the levy is unlikely to raise exports significantly as China is entering the winter phase, a traditionally weaker demand period.
From Nov. 19, exports of specified pig iron and steel products and iron ore pellets will attract ‘nil’ export duty.
The export duty on outward shipment of iron ore lumps and fines with less than 58% iron content will be ‘nil’. In the case of iron ore lumps and fines with more than 58%, the rate of duty will be 30%.
Import duty relief on coking coal and ferro nickel reduced has also taken back with levy of 2.5% duties versus nil previously.
The tax, when imposed, was aimed at stemming exports to help increase domestic availability in order to aid lower prices.
Here’s what brokerages made of the tax being removed: