JSW Steel to maintain shipments to Europe without passing on cost of export tax
- India, South Asia's third-largest economy, raised export tax by 15% on eight steel intermediates and scrapped import duty on coking coal, shortages of which have been driving up steel prices.
India's largest steel producer, JSW Steel Ltd, will continue to supply products to its buyers in Europe without passing on any increase in costs despite New Delhi's decision to impose an export tax, a senior company official said on Monday.
India, South Asia's third-largest economy, raised export tax by 15% on eight steel intermediates and scrapped import duty on coking coal, shortages of which have been driving up steel prices.
The export taxes on steel where part of a series of changes to taxes on crucial commodities aimed at reining in retail inflation, which has hit eight-year highs.
The government also scrapped import duty on coking coal, a key steelmaking raw material, and raised export tariffs on iron ores and concentrates to 50% from 30%.
After New Delhi's decision to slap the export tax, analysts had warned that the move would force steel companies to curtail overseas shipments.
The increase in export taxes on iron ore, announced by the Indian government will lead to large surpluses at home, and mainly hit producers of low grade ores that depend on overseas markets, a mining industry body said.
JSW Steel has earmarked ₹20,000 crore capital expenditure in the current fiscal and hoped that headwinds such as export duty on steel and high coking coal prices are likely to be short-lived.
The leading steelmaker in the country does not expect any "substantial easing" of price of the metal in the domestic market from the current levels, unless the prices of coking coal, a key raw material for the steel manufacturing, moderate in the international market.
Russia and Ukraine exported 46.7 million tonnes in 2020, mostly to the European Union, the world's second biggest importer of steel, according to the World Steel Association.
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First Published:30 May 2022, 03:22 PM IST
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