On April 21, 2025, India placed a 200-day, 12% provisional safeguard duty on five categories of steel products, such as hot-rolled coils, sheets, and plates, in order to shield domestic producers from dumping. The decision comes after the DGTR, the Commerce Ministry's investigative arm, recommended it. For the five steel product categories, the government has set import prices ranging from $675 to $964 per tonne. The safeguard duty would be applied to any shipment that was imported for less than these import prices. Parthiv Jhonsa of Anand Rathi Institutional, in a chat with ET Now explains what it means for Indian manufacturers.
Jhonsa says the safeguard duty for 200 days gives room for domestic mills to increase the price over the next couple of weeks. As far as stocks are concerned, manufacturers with a massive presence in flat steel, companies like JSW Steel, Steel Authority of India (SAIL) and Tata Steel would benefit. But out of all the three, one can still look into JSW as a counter.
I guess this move actually clears months of overhang. How are you reading into it?
Parthiv Jhonsa: Yes, definitely, this entire safeguard duty topic was going on for the last couple of months and now the notification is finally out, gives a clear-cut road map for next 200 days for all your carbon, ferrous manufacturers. So, overall, it is a very positive sentiment at the end of the day because this actually gives a good level playing field to all your domestic mills, especially as whether it is tier I or tier II, it provides a good level playing field, particularly for manufacturers of HRC.
Parthiv Jhonsa: I will try and answer this a bit differently. This was basically going on for about a good three to four months’ horizon. 12% was something which was known the last couple of weeks and the announcement was very well in line with that. We did some backward calculation and in my opinion, our domestic prices are still going at close to 3 to 4 odd percent discount to the Chinese and close to about 6-7% discount to FTA landed price when you include port handling and all other charges to it.
In the last couple of weeks, there was a slight reduction in your domestic steel prices. So, this gives a good room for domestic mills to increase the price over the next couple of weeks. As far as stocks are concerned, people who have a massive presence in flat steel, especially companies like JSW, Steel Authority of India (SAIL), and Tata Steel would benefit. But out of all the three, you can still look into JSW as a counter.
Jhonsa says the safeguard duty for 200 days gives room for domestic mills to increase the price over the next couple of weeks. As far as stocks are concerned, manufacturers with a massive presence in flat steel, companies like JSW Steel, Steel Authority of India (SAIL) and Tata Steel would benefit. But out of all the three, one can still look into JSW as a counter.
I guess this move actually clears months of overhang. How are you reading into it?
Parthiv Jhonsa: Yes, definitely, this entire safeguard duty topic was going on for the last couple of months and now the notification is finally out, gives a clear-cut road map for next 200 days for all your carbon, ferrous manufacturers. So, overall, it is a very positive sentiment at the end of the day because this actually gives a good level playing field to all your domestic mills, especially as whether it is tier I or tier II, it provides a good level playing field, particularly for manufacturers of HRC.
This move has removed months of overhang because the timing was very uncertain. Do you think this would be the moment where you buy on rumour, and sell on news or do you think it is time to trim your positions in some of these metal counters or this is the time to load up on some of them?
In the last couple of weeks, there was a slight reduction in your domestic steel prices. So, this gives a good room for domestic mills to increase the price over the next couple of weeks. As far as stocks are concerned, people who have a massive presence in flat steel, especially companies like JSW, Steel Authority of India (SAIL), and Tata Steel would benefit. But out of all the three, you can still look into JSW as a counter.
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