Steel company shares lost on Monday, even as broader markets and most major sectors saw firm gains, on news that the government would not continue minimum import price on 19 colour-coated steel products, which seeks to protect domestic producers from an onslaught of cheaper imports.
The BSE Metal index ended down 0.3% at 11,853.76 points and Nifty Metal index ended down 0.28% at 3,119.8 points. On the contrary, BSE Sensex ended up 0.7% at Rs 28,439.28 points and Nifty ended up 0.69% at 8,801.05 points.
Earlier today, the government said it will not extend the protectionist minimum import price (MIP) on 19 colour-coated steel products. The development comes a day after Steel Minister Chaudhary Birendra Singh stated that industry must gear up to face global competition as protectionist measures like MIP and anti-dumping can not continue indefinitely.
The government had imposed MIP on these 19 products, which are mainly colour-coated steel items, till February 4. However, the government may impose anti-dumping duty on these 19 colour-coated steel products if required, Sharma said. “The steel ministry would watch and if required necessary action would be taken (on 19 colour-coated steel products),” she said.
Last month, the government had said that it may impose anti-dumping duty on 19 colour-coated steel products with a view to protect domestic players from cheap inbound shipments and give a fillip to the sector.
The government had imposed MIP on 173 items in February last year, but reduced it later to 19 products, converting the remaining to an anti-dumping duty. “Anti-dumping will continue as the evidences are there,” Sharma had said earlier.
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Steel makers had urged the government to extend MIP on certain products, saying its imposition has marginally improved the industry’s viability after a long period of subdued prices.
Accelerating imports at predatory prices from steel surplus countries like China, Japan and Korea have been a major concern area for the domestic industry since September 2014.
Post the imposition of MIP in February, the industry has been able to marginally improve viability after a long period of subdued prices and eroded profit margins, Indian Steel Association had said.