DGFT to discuss issues raised on recommendations on met coke imports
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In a recent update, The Directorate General of Foreign Trade (DGFT) will convene a meeting to address concerns regarding the Directorate General of Trade Remedies (DGTR) proposed imposition on met coke imports. The meeting will be held under the chairmanship of S.K. Sarangi, scheduled on 28 May, 2024, at 12:00 PM in Vanijya Bhawan, New Delhi. The agenda includes discussing the final recommendations by DGTR concerning restrictions aimed at protecting domestic met coke industries and regulating imports. The meeting will also address issues raised by the steel and alloy industries regarding these recommendations. The attendees include:
1. DG, DGTR,
2. Economic Advisor Udyog Bhavan, New Delhi,
3. Joint secretary, Ministry of Coal, Shastri Bhawan, New Delhi
4. Relevant stakeholders.
The Major findings of the DGTR were as follows:
- The period of the investigation (POI) is from 1 April, 2022 to 31 March, 2023
- Definition of 'PUC' is as under :"low ash metallurgical coke, that is, metallurgical coke having ash content below 18% excluding coke fines/ coke breeze and ultra- low phosphorous metallurgical coke with phosphorous content up to 0.030% with size of 30 mm with 5% size tolerance for use in ferroalloy manufacturing metallurgical coke with high ash content, that is, ash content above 18% is outside the scope of 'PUC'.
- China was not the largest supplier of coke during the period of investigation and constitutes only 11% of total imports, over the investigation period i.e. 12.58 lakhs against total imports of 112.95 lakhs. Accordingly, imposition of measures would not lead to scarcity of availability of product in India.
- The information on record shows that even if the prices of met coke increase post imposition of measures on imports of the product, the impact of such measures will be negligible.
- As the QR measures are recommended only for a period of one year and there is no demand-supply gap in India which may lead to scarcity of the product or arbitrary pricing.
Setbacks
- As per Alloy Steel Producers Association of India (ASPA) submission, ferro alloy industries depend on imports to meet the quality requirements for producing customised steel for downstream industries like Auto, Defence, and Aerospace etc. Therefore, in the larger interest of consumer industry of low ash metallurgical coke the recommendations of DGTR may not be accepted.
- Met coke is one of the major input raw materials for Iron and Steelmaking. Therefore, its alarming to permit only 2.85 mnt of met coke imports is equivalent to production of only 5-6 mnt of steel. The QR would be a great setback to the Indian steel industry which has committed large investments. This trade barrier would also influence the availability of met coke and coking coals, thereby further affecting its free and fair pricing.
Key recommendations by DGTR:
1.DGTR had recommended the imports of the product under consideration are regulated and permitted not beyond the levels which have been derived based on an average of imports in the three representative years during the period of investigation, that is, 2019-20, 2020-21 and 2021-22 without considering the surge period, that is, 2022-23.
2.The quota had been adjusted and increased in line with the increase in demand and highest capacity utilisation of the domestic industry during the period prior to the surge period.
3.Imports would be permitted through the EDI ports only to facilitate electronic/real-time monitoring of the allocated quota. The quota would be monitored on a quarterly basis. The total imports allowed in any quarter shall not exceed the total of that quarter and the next quarter. Any unutilized quota for a quarter shall be added to the next quarter.
What is the case all about?
Towards end June, 2023, the DGTR had embarked on a rigorous investigation into the significant increase in imports of low-ash metallurgical coke (below 18% ash). This proactive measure follows allegations raised by five leading companies (BLA Private, Jindal Coke, Saurashtra Fuels, Vedanta Malco Energy and Visa Coke), highlighting the adverse impact of rising imports on domestic producers.
The applicants had proposed a period of investigation during April-December, 2022. However, the authorities considered April-March, 2023 as the most recent period for the purpose of investigation.
By addressing the concerns raised by domestic stakeholders, DGTR aims to maintain a level playing field and bolster the competitiveness of local producers in the face of mounting external pressures.
