The import floor prices, which were about to be lowered in April, are now expected to be increased in almost all cases, except tinplate seconds, waste and defectives. Tinplate waste and defectives are not widely traded, as most developed nations ban the use of the potential health-hazard.

The steady rise in steel rates worldwide in the last quarter had already rendered the import price bands infructuous, pointed out a source in government. Essar Steel for instance, has booked export orders for hot rolled (HR) coils at $305 a tonne, which was $2 a tonne higher than the price band for imports.

Since tinplate wastes are not widely traded, the item does not have readily available reference prices. The grapevine buzz is that the much-maligned packaging material (considered unfit forwrapping edibles) may become easier to import because of the peristent machinations of a can-makers' lobby.

Can-makers have been crying themselves hoarse over the import price bands right from the start. The floor for tinplate wastes is expected to drop to $ 400 a tonne, from $545 a tonne at present.

The union ministry of steel had recommended a floor price of $464 a tonne for tinplate seconds in April, when the price bands first came up for review. The commerce ministry is expected to shortly seek an update on reference prices.

The two ministries have not had any formal parleys on the floor price, since the August 2 meeting at the Prime Minister's Office. It is also not clear at this juncture, whether revising the floor prices will require a nod from the Election Commissioner or not.

A decision, however, is expected to be taken shortly as the import price bars had already become ineffective. The April list was a six monthly average of rates prevailing in major trading centres around the world betweenOctober 1998 and March this year.

The floor prices announced in December were a three-monthly average of world steel prices between May and July last year. The steel market has been through much upheaval since then.

Hot rolled (HR) steel prices in Europe, for instance, dropped to $205 a tonne (free on board) at the end of last year (when the floor prices were announced) from $316 a tonne in early 1998, only to glide down again to $ 225 a tonne in June this year.

In the last two months HR coils prices have moved in the range of $ 295 a tonne to $ 305 a tonne. Steel slab prices plunged to $ 148 a tonne by end 1998 from $ 265 a tonne earlier in the year and increased again to $ 180 a tonne by June this year.

Earlier this year, the Union Commerce ministry sought expert opinion on the floor prices from the National Institute of Public Finance and Policy (NIPFP) director Ashok Lahiri. Lahiri condemned the floor prices on prime grades of steel as incompatible with WTO norms.

The Prime Minister's Officesubsequently had a pow-wow with the Union ministries of steel and commerce. Even though the August 2 discussions at the PMO still remain largely shrouded in secrecy, it seems certain that a consensus had been arrived at retaining the floor prices.

The Union ministries of steel and commerce, which have not seen eye to eye on the floor prices issue, also seem to agree that the rates should be periodically updated.