Posted on 24 Apr 2019
Indian steel importers are increasingly anxious about additional products, including more grades of hot-rolled coil (HRC), coming under the influence of quality control standards as these may restrict imports.
The Bureau of Indian Standards (BIS) has identified 13 additional steel products for which domestic and global producers will have to acquire quality control licences before they can be sold in India, although no date for implementation has been announced. The products includes additional grades of hot-rolled steel in coil, sheet and strip form, structural steel, carbon alloy bright steel bar, steel for hardening and tempering, certain grades of automotive steel, as well as semi-finished products such as billet, ingot, bloom and slab.
India has already implemented BIS quality regulations on 53 steel products, some of which are being contested by the EU at the World Trade Organisation. The EU has demanded that India should stop carrying out factory inspections in EU steel mills that have implemented quality management systems that meet Indian standards.
"The new order on 13 products will result in a rise in domestic prices, as local mills which already have BIS licences will not face any competition from imports," said a Mumbai-based trader. Most foreign mills do not currently have BIS certification and acquiring these licences is an extended process requiring physical verification of products in steel mills and India-based laboratories.
India's finished steel imports increased by 4.7pc from a year earlier to 7.84mn t in the 2018-19 fiscal year ended 31 March. The largest steel exporter to India was South Korea, with the bulk of its exports comprising HRC. Large-scale integrated Indian steel producers secured a large portion of their margins through sales of HRC and cold-rolled coil (CRC). Imports of flat product, such as HRC and CRC, are charged a 12.5pc import duty with additional anti-dumping and safeguard duties.
The increase in imports raised anxiety among Indian steel producers that appealed to the government to introduce additional quality control restrictions, said a Delhi-based importer.
HRC imports during February rise by 30.7pc from a year earlier to 157,700t, according to latest government data. February imports of CRC rose by 232pc from the previous year to 55,600t, while coated sheet imports rose by 68.3pc to 13,600t.
