Indian steelmakers face hit on Europe deals over export tax -JSPL exec

div classBodysc17zpet90 cdBBJodivpBy Sudarshan Varadhan and Aftab Ahmedp

pNEW DELHI Reuters – Indian steel firms could be forced to cancel European orders and suffer losses after an overnight decision to impose export taxes on steel products, V R Sharma, managing director at Jindal Steel and Power told Reuters.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pIndia imposed an export tax of 15 on eight steel products late on Saturday, at a time steelmakers are looking to make up for tepid local demand by increasing market share in Europe, whose supplies have been hit by Russias invasion of Ukraine.p

p“They should have given us at least 23 months of time, we did not know about such a substantial policy,” Sharma told Reuters in an interview.p

pSharma said Indian steelmakers have about 2 million tonnes in pending export orders, mostly to Europe, which are stuck in ports or in various stages of production.p

p“This could possibly lead to force majeures. And the customer has done no wrong here and he doesnt deserve to be treated that way,” he said.p

pRussia and Ukraine exported 46.7 million tonnes in 2020, mostly to the European Union, the worlds second biggest importer of steel, according to the World Steel Association.p

pThe decision could raise industry costs by as much as 300 million, he said.p

p“We alone have 260,000 tonnes of orders, which were taken when export duty was zero,” Sharma said.p

pJSPL, Indias fifth largest crude steel producer which competes with Tata Steel, JSW Steel, SAIL and ArcelorMittal Nippon Steel India, was targeting boosting its exports to up to 40 of sales, mostly to Europe.p

pThe 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 eightyear highs.p

pA removal of import duties on coking coal, PCI coal and anthracite and imposing an export tax on iron ore, all key raw materials used in steelmaking, might not be enough to soften the blow to exports, Sharma said. p

p“Coking coal prices are still very high,” he said, adding that the export tax would benefit local carmakers and others heavy engineering industries.p

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pp Reporting by Sudarshan Varadhan and Aftab Ahmed editing by Jason Neelyp

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