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CHAIRMAN's DESK

Steel industry is once again in the grip of speculative fever as international prices have dropped by over $100 per tonne and there are expectations that there may be a further drop over the next few months. Domestic players have, of course, responded by reducing their prices but the consumers feel that the reduction is not adequate. Chairman, SAIL has stated that it takes time to adjust to international levels and, therefore, in due course domestic prices will come down to the import parity levels. The consuming industry would rather see that happening today than tomorrow. Peter Marcus of World Steel Dynamics has predicted that prices should stabilize in a few months. The temporary slow down in China is expected to lift shortly and demand will pick up level. Of course, the European and US markets are already in a partial tailspin with producers cutting back on production so as to maintain the price line. There are again concerns about dumping of steel from CIS countries and in India alone, there has been a surge of about 400% in import of HR coils in the last few month. Only a few days ago, the European Union sent a delegation to express their concern regarding surge in imports of coated steel into Europe and there was a free exchange of views between government and our steel industry. Our industry, on the other hand, was equally expressive and concerned about surge in imports from the CIS into our country. Nevertheless, the point has been driven home that the industry has to maintain some restraint so that a win-win situation is maintained and no penal trade action is resorted to by main importing countries. In fact our industry is now very keen that we should establish contacts with the industry in Ukraine and other CIS countries so as to request them to maintain restraint in their exports. In an increasingly globalised world, it is evident that continuous dialogue is necessary to understand each other's view points so that a free market actually functions in the way that it should. There will always be minor abrasions in a free market mechanism but for the system to generally function well, it requires some element of self-control on behalf of all players. After a long time now, the talk about anti dumping and trade union has revived and it is not clear whether we will be able to return to the golden times of 2004. This issue is devoted to the refractory industry which constitutes an important sector of the iron and steel industry in our country. The government has tried to bring down duty on refractory inputs as far as possible but there are still some anomalies which need to be corrected since certain inputs and refractory products are of equivalent tariffs. These and other issues have been taken up and will be pursued to their logical conclusion.    (J P Singh) Joint Secretary Ministry of Steel & Chairman, JPC.