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India’s steel industry to look at renewable energy to avoid CBAM tariffs

To address carbon leakage, the EU introduced a carbon levy on imported goods.

Published

2 days ago

September 26, 2024

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The EU Emissions Trading System (ETS), launched in 2005, is a key element of the European Union’s climate change strategy and remains the world’s largest carbon market. Under the system, producers within the EU are required to offset their CO2 emissions by purchasing allowances from the EU ETS. This has led some companies to relocate their operations to regions with less stringent emissions regulations in order to reduce costs, a phenomenon known as ‘carbon leakage’. To counter this, the EU introduced a ‘carbon levy’ on imported goods, applying it to products from countries with lower emissions standards than those of the EU to prevent highly emission-intensive imports.

Building on this, the European Commission has proposed the world’s first ‘carbon border tax’, aimed at imports of carbon-intensive products such as steel, hydrogen, cement, fertilisers, and aluminium, in line with the EU’s climate goals. This tax is based on the EU’s domestic emissions regulations and includes fees for exceeding emissions limits. The Carbon Border Adjustment Mechanism (CBAM), which targets these sectors, is expected to affect around 4% of the EU’s total imports by value.

Indian steel exports to Europe, which account for over 20% of India’s total steel exports in the first half of FY25, may be significantly impacted. Italy, Belgium, Spain, and the United Kingdom are among the primary destinations. Indian steel production emits 2.6 tonnes of CO2 per tonne of steel, higher than the global average of 1.85 tonnes, giving the EU a rationale for imposing higher duties on Indian products. According to ICRA, the CBAM framework could affect 15-40% of India’s steel exports to Europe, with the impact expected to be felt from 2026 to 2034. Notably, the USA and Singapore are also likely to introduce similar policies.

Related Topics:'carbon leakage Carbon Border Adjustment Mechanism (CBAM)EU ETS (Emission Trading System)

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MSMEs Oppose Proposed Steel Import Duty Hike Amid Price Volatility

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MSMEs Oppose Proposed Steel Import Duty Hike Amid Price Volatility

FOCIA urges government to reconsider steel import duty hike

Published

5 days ago

September 23, 2024

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Micro, small, and medium enterprises (MSMEs) in Coimbatore are raising concerns over the Union steel ministry’s proposal to increase the import duty on steel products, fearing it could harm their businesses. The Federation of Coimbatore Industrial Associations (FOCIA) has sent an urgent letter to the Union steel and heavy industries minister, urging a reconsideration of the move.

FOCIA highlighted that MSMEs, which purchase steel for manufacturing components supplied to large industries, have struggled with volatile steel prices since the pandemic. After recent price reductions, these smaller industries are finally recovering, securing export orders. However, the proposed import duty hike threatens to disrupt this fragile stability, making it difficult for MSMEs to fulfill existing orders, particularly those from public sector units (PSUs) like the railways.

FOCIA also called for a ‘maximum selling price’ policy for metals like steel, aluminum, and copper to protect MSMEs from future price volatility. Additionally, they renewed their demand for a price monitoring committee that includes MSME representation to ensure fair pricing.

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India Tackles Rising Steel Imports

India addresses challenges posed by increasing steel imports.

Published

5 days ago

September 23, 2024

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India is actively discussing measures to manage rising steel imports, as stated by Steel Minister H.D. Kumaraswamy. The minister highlighted that despite robust domestic demand, the surge in imports poses significant challenges for local steelmakers.

Key Points:

Current Import Trends: India, the second-largest producer of crude steel, has been a net importer throughout the fiscal year ending March 2024 and continued this trend from April to July.

Top Exporters: China emerged as the largest steel exporter to India during this period, followed by Japan and South Korea.

Impact on Prices: The influx of imports has contributed to a decline in local steel prices, which have reached their lowest levels in over three years, according to data from BigMint.

Government Response: Kumaraswamy indicated that the ministry aims to persuade the finance ministry to increase tariffs on steel imports to safeguard domestic manufacturers from cheaper imports, particularly from China.

Anti-Dumping Measures: In August, India launched an anti-dumping investigation on specific steel products imported from Vietnam, responding to concerns from leading steel producers like JSW Steel and ArcelorMittal Nippon Steel.

Conclusion: The Indian government is taking proactive steps to protect its steel industry amid rising imports, ensuring the sustainability of local production.

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Tata Steel commissions India’s largest blast furnace at Kalinganagar

The new furnace is part of Tata Steel’s strategy to meet increasing demand for steel

Published

5 days ago

September 23, 2024

admin

Tata Steel has officially commissioned India’s largest blast furnace at its Kalinganagar plant. This significant development is expected to boost the company’s production capacity and enhance operational efficiency. The new furnace is a key part of Tata Steel’s strategy to meet increasing demand for steel in the domestic market.

The state-of-the-art facility features advanced technology aimed at reducing emissions and improving sustainability. This move aligns with Tata Steel’s commitment to environmentally responsible production practices while maintaining competitiveness in the industry.

With this commissioning, Tata Steel is well-positioned to strengthen its leadership in the Indian steel sector and cater to the growing needs of various industries.