Steel export duty may halve or vanish as prices soften

The government is planning to halve or eliminate the export duty on steel products amid falling prices and rising domestic supply, Mint reported on August 5 citing people with knowledge of the development.

The steel ministry has already taken up the matter with the finance ministry after receiving multiple industry representations.

The 15 percent export duty imposed on 22 May might be halved or abolished by the end of the month.

Moneycontrol could not independently verify this news.

However, industry officials have told Moneycontrol that the export duty on steel is weighing on domestic manufacturers which may force them to revisit their capital expenditure plans. JSW Steel has already announced a Rs 5,000 crore reduction in capex to Rs 15,000 crore in the current fiscal while Tata Steel has left its capex plan unchanged.

Moreover, many officials this publication spoke to said steel prices were softening in the domestic market due to moderation in input prices, making the duty unnecessary.

Shares of steelmakers gained following the news reports of export duty rollback.

NMDC Limited shares jumped 3.17 percent and were currently trading at Rs 110.85 apiece. Jindal Steel advanced 2.72% to trade at Rs 393.20. Vedanta stock went up nearly 2% and was trading at 254.50.
Source: MoneyControl