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Mint
a day ago
- Business
- Mint
Importers finding gaps in India's 12% steel safeguard duty: JSW Steel's Jayant Acharya
Mumbai: Importers are finding ways to bypass the 12% safeguard duty on steel imports levied in April this year, leading to a rout in domestic prices, even as the import volumes come down, said Jayant Acharya, the joint managing director of JSW Steel. One of the workarounds is the misuse of the Advance Authorization Scheme, which allows duty-free imports of raw materials for export-linked production. Importers get 18 months to export the finished product to prevent paying the safeguard duty. Some non-automotive importers are using this scheme to buy cheaper steel from overseas and sell the finished goods in the domestic market, alleged Acharya. They are betting on the domestic prices softening during the 18-month window allowed under the scheme before eventually using local steel to make products for export, he said. Other workarounds include buying semi-finished steel, which doesn't attract the safeguard duty, and then processing it further domestically, he said. Such imports have risen particularly from countries like Russia as well as the Asean bloc, he said. 'If there are any leakages which happen, we need to block (them)," Acharya said in an interview. The JSW Steel executive's comments come as prices of steel in the domestic market continue to fall despite strong demand and decreasing imports. Prices of benchmark hot-rolled coils (HRC) of steel, which is used in cars and consumer durables among other things, fell to a four-month low to ₹50,700 for a tonne in June, as per data from BigMint, a market intelligence firm. The price fall was in tandem with a fall in international steel prices, even as India's imports came down. The country imported 1.4 million tonnes of finished steel during the April-June quarter, a third less than the preceding quarter, as per an investor presentation from JSW Steel. During this period, India's steel consumption is estimated to have grown by about 7% compared with the preceding quarter at about 38.3 million tonnes. Acharya argued that the headline trade figures do not convey the full picture. Considering steel imports arrive 1-2 months after an order is placed, the official import data fails to reflect real-time market sentiment around pricing, he said. 'Sentiment is determined by the booking of imports which happen in the month of operation. So if the booking of imports is at a lower level, that becomes a reference point for discussion with the domestic (steel producers)," he said. Moreover, the import prices continue to influence the domestic market regardless of the quantities, he said. This means, even as import volumes narrow, the prices of domestic steel were likely to remain under pressure. 'There are other countries also which are now coming into India," he said, indicating a surge in imports from Russia and the 10-narion Asean bloc in recent months. This was because of the high tariffs in markets like the US and Europe, forcing these countries to export more to India, he said. The steel industry contributes nearly 2% to India's GDP. JSW Steel is the largest domestic steelmaker by capacity, followed by Tata Steel, Steel Authority of India and Jindal Steel and Power. During a post-earning interaction with analysts last week, JSW Steel's management said that it expects a favourable decision when the government reviews the safeguard duty on steel imports, both on the duration and rate. The government imposed a 12% safeguard duty on steel imports on 21 April for a period of 200 days. Steel is a capital-intensive industry, Acharya said, pointing to the need for long-term stability in terms of tariffs to avoid exposure to global market uncertainties before making long-term investments in steel plants. JSW Steel tripled its profits in June quarter of FY26, supported by higher production and sales volume along with easing coking coal costs, a key raw material. The steelmaker reported a profit of ₹2,209 crore compared to ₹867 crore in the same quarter a year ago. The consolidated revenue for the first quarter of FY26 was ₹43,147 crore, compared to ₹42,943 crore from the same period last year. The Supreme Court's ruling on Bhushan Steel and Power Ltd (BPSL) won't impact their expansion plans, said Acharya. On 2 May, SC rejected JSW Steel's ₹19,700 crore acquisition of BPSL and ordered its liquidation. The company is waiting for the apex court hearing on their review petition before undertaking a 0.5 million tonne expansion at BPSL. However, that has no bearing on their target and they are on track to achieving its 50-million-tonne-capacity by 2050. Archarya also reaffirmed that steel demand in India is strong and is set to see an incremental growth of around 13 -14 million tonnes in FY26. This would be a rise from 144 million tonnes in FY25, as per BigMint estimates. With additional volumes kicking in from the ramp-up at JSW Vijayanagar Metallics Ltd (JVML) and the Blast Furnace 3 upgrade post-shutdown will aid the steel maker's ability to meet this growing demand. JSW Steel is expanding its Vijayanagar plant in Karnataka by adding 5 million tonnes per annum (mtpa) through its subsidiary JVML, which will bring the total capacity of the plant to 18 mtpa. JSW Steel has a consolidated capacity of 35.7 mtpa including domestic capacity of 34.2 mtpa and 1.5 mtpa in the US. On the cost front, the steelmaker expects to see some benefit due to the strategic steps taken, particularly in areas like coking coal. In the current quarter coking coal prices were softer but they are stabilizing now, said Acharya. Coking coal is a key ingredient used to make steel besides iron ore. It is heated without air and turned into coke, which is used in blast furnaces to help turn iron ore into liquid iron. This iron ore is then used to make steel. On the raw material side, 'we continue to look at startup of the new mines which we have got in the captive in Karnataka and Goa," he said, adding that their domestic coking coal mines are expected to be operational in the next few years, which will further support cost efficiencies. The company's overseas operations are expected to improve, driven by a more favourable international pricing environment. The steelmaker has a 1.5 mtpa electric-arc-furnace-based steel manufacturing unit in Ohio, US and a 1.75 mtpa plate and pipe production mill in Texas. In Italy, it has a 0.32 mtpa rail manufacturing unit, which is undergoing an expansion in capacity to 0.6 mtpa.
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Business Standard
a day ago
- Business
- Business Standard
Need to look at safeguard extension and rate levied: JSW's Jayant Acharya
Q1 was disrupted by plant maintenance shutdowns at Dolvi and Bhushan Power and Steel (BPSL), which had an impact on our costs both for capex and operations premium Ishita Ayan Dutt Kolkata Listen to This Article The interim safeguard duty of 12 per cent has cushioned the Indian steel industry from cheap imports, but JSW Joint Managing Director and Chief Executive Officer Jayant Acharya tells Ishita Ayan Dutt in an audio interview that tariff uncertainties are leading to trade diversions from Russia and Asean countries, and India needs to wall up to support private capex in steel industry. Edited excerpts: The provisional safeguard is for 200 days. Are you in favour of a longer duration safeguard? Yes. In Europe, it has been valid for multiple years. In addition, Europe has anti-dumping on various countries. Then they
News18
3 days ago
- Business
- News18
JSW Steel expansion plan on track despite SC order on BPSL: Jayant Acharya
New Delhi, Jul 18 (PTI) JSW Group on Friday said its expansion plan will not be impacted by the Supreme Court order to set aside the acquisition of Bhushan Steel and Power Ltd (BSPL) through the insolvency process. JSW Steel Joint MD and CEO Jayant Acharya, in an earnings call, said that BPSL was not part of the brownfield expansion that the steel company took into account while setting the 50 million tonnes capacity target by 2030-31. 'In our 50 MT tonne outlook (expansion) that we have given up to 2030-31, BPSL was not part of the brownfield expansion that which we have taken into account. So therefore, it will not impact our target which we have given," Acharya said, in an earnings call, said while replying to a question if the acquisition of BPSL asset going into legalities will affect JSW Steel's expansion plans. He also said that the company has filed a review in Supreme Court for BPSL case and believes there is a strong ground for the same. 'For that 0.5 MnT (expansion) we will take a view. That is the only one (expansion) basically to be decided (after the SC decision on BPSL)," Acharya said. Located in Odisha's Jharsuguda, BPSL recorded a crude steel production capacity of 3.38 million tonnes (MT) in FY25. JSW Steel had envisaged ramping up BPSL's capacity to 5 MT, eyeing to benefit from the higher sales and realisations from value-added products such as colour-coated, galvanised sheets, pipes and wires. In 2019, JSW Steel had won the bid to acquire Bhushan Power & Steel under the IBC for a little less than Rs 20,000 crore. BPSL has an operating capacity of 4.5 MT as of now. JSW Steel said the Committee of Creditors and Resolution Professional have also filed separate review petitions. The review petitions will be listed in the Supreme Court in due course. The Supreme Court has directed status quo in respect of proceedings before NCLT for implementation of the SC judgment until the review petition is decided. 'We, along with our legal advisors, have analysed the matter and are of the view that we have strong grounds to pursue the Review Petition," he said. PTI ABI ABI MR MR (This story has not been edited by News18 staff and is published from a syndicated news agency feed - PTI) view comments First Published: July 18, 2025, 22:45 IST Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Business Recorder
3 days ago
- Business
- Business Recorder
India's JSW Steel says low priced imports a concern after profit beats estimates
India's top steelmaker JSW Steel flagged concerns of cheaper steel imports on Friday after the company beat first-quarter profit estimates. Indian steelmakers have been under pressure from a surge in low-cost shipments primarily from China, prompting production cuts and job concerns across the industry. The government imposed a temporary 12% import tariff, locally known as safeguard duty in April to curb cheap imports. Although domestic steel prices improved quarter-on-quarter, they remained below year-ago levels. 'There is a case for the government to consider the safeguard duty favorably, in terms of extension as well as in terms of the overall duty percentage,' Jayant Acharya, chief executive of JSW Steel, said. India's JSW Steel faces challenges importing coking coal from Mongolia Given that many countries are putting trade barriers, lower-priced imports are coming to India, which is impacting sentiment, Acharya said. He added that some low-priced imports from Russia also require monitoring. Earlier in the day, JSW Steel reported a consolidated net profit of 21.84 billion rupees ($253.52 million) for the three months ended June 30, exceeding analysts' average estimate of 20.39 billion rupees, supported by easing raw material costs. Revenue from operations largely remained flat at 431.47 billion rupees, as weaker year-on-year steel prices offset a 9% rise in sales volumes. JSW's total expenses decreased by 3.3% to 403.25 billion rupees, primarily due to a similar decline in the cost of materials consumed. JSW Steel's shares closed flat ahead of the quarterly results.
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Business Standard
3 days ago
- Business
- Business Standard
JSW Steel expansion plan on track despite SC order on BPSL: Jayant Acharya
JSW Group on Friday said its expansion plan will not be impacted by the Supreme Court order to set aside the acquisition of Bhushan Steel and Power Ltd (BSPL) through the insolvency process. JSW Steel Joint MD and CEO Jayant Acharya, in an earnings call, said that BPSL was not part of the brownfield expansion that the steel company took into account while setting the 50 million tonnes capacity target by 2030-31. "In our 50 MT tonne outlook (expansion) that we have given up to 2030-31, BPSL was not part of the brownfield expansion that which we have taken into account. So therefore, it will not impact our target which we have given," Acharya said, in an earnings call, said while replying to a question if the acquisition of BPSL asset going into legalities will affect JSW Steel's expansion plans. He also said that the company has filed a review in Supreme Court for BPSL case and believes there is a strong ground for the same. "For that 0.5 MnT (expansion) we will take a view. That is the only one (expansion) basically to be decided (after the SC decision on BPSL)," Acharya said. Located in Odisha's Jharsuguda, BPSL recorded a crude steel production capacity of 3.38 million tonnes (MT) in FY25. JSW Steel had envisaged ramping up BPSL's capacity to 5 MT, eyeing to benefit from the higher sales and realisations from value-added products such as colour-coated, galvanised sheets, pipes and wires. In 2019, JSW Steel had won the bid to acquire Bhushan Power & Steel under the IBC for a little less than Rs 20,000 crore. BPSL has an operating capacity of 4.5 MT as of now. JSW Steel said the Committee of Creditors and Resolution Professional have also filed separate review petitions. The review petitions will be listed in the Supreme Court in due course. The Supreme Court has directed status quo in respect of proceedings before NCLT for implementation of the SC judgment until the review petition is decided. "We, along with our legal advisors, have analysed the matter and are of the view that we have strong grounds to pursue the Review Petition," he said.
