The Ministry of Finance (Department of Revenue) has imposed a duty of 15% on the export of steel. The move is likely to bring down the prices of solar mounting structures, providing some relief to mounting structure manufacturers and solar project developers.
A 15% duty has been imposed on flat-rolled products of steel of a width of 600 mm or more, other bars and rods of stainless steel, and bars and rods hot rolled into irregularly wound coils of other alloy steel.
The government has decided not to impose any duty on the import of raw materials used for the production of steel, like pulverized coal, coking coal, and ferronickel.
Steel prices have been on an upward trend since last year.
JSW and Tata Steel dominate the Indian market. The export of steel by these companies adds to the demand-supply gap in the domestic market.
Harshal Akhouri, Co-founder of Strolar Mounting Systems, reacted to the government move by saying, “There is a considerable gap between domestic demand and supply. A 15% duty on steel export is a good step. With the duty in place, Indian products will not be competitive enough in the international market.”
He also said that with no duties for raw materials, the price of coking coal is expected to decrease by 5%. He expected that the prices of module mounting structures would come down by nearly 10%.
“Once the demand picks up, prices will stabilize, and the developers will get a clearer picture of project development. For utility-scale projects, steel module mounting structures are used, whereas, for rooftop projects, aluminum is used,” Akhouri added.
A top executive from another module mounting structure manufacturer said, “I think steel producers were exporting large quantities and creating a vacuum in India. Now, things will improve. With steel prices expected to decrease, developers and independent power producers will be happy. The price reduction could be up to 10%.”
The executive, however, felt that the prices would come down only in July or August.
Last September, the Directorate General of Trade Remedies recommended anti-dumping duty on certain flat-rolled aluminum products imported from China to offset the injury caused due to dumping in the Indian market. Flat-rolled aluminum is used in manufacturing solar module mounting structures for rooftop solar projects.
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