June 02, 2010
Filed Under: Economy and Business and Finance, Iron & Steel
WITH TARIFFS ON RAW MATERIALS for galvanized iron (GI) sheets set to go down to zero, the Department of Trade and Industry will be revisiting the current suggested retail prices (SRPs) of steel products, to ensure that these are in line with world price movements and the new tariff regime.
Trade Undersecretary Zenaida Maglaya said that while there was no indication of price adjustments at this point, price movements in the world market would have to be reviewed, to see where local prices could go in the coming months.
“Now that tariffs will be reduced to zero, we’ll have to update ourselves on the current costs to see what will happen to our SRPs. We should be done with (the review) by Saturday,” she told reporters.
“The galvanizers said that for their July deliveries, price offers were quite high. For the June arrivals, they said the price was $900 (per metric ton) and $920 per MT for July deliveries. But the high prices should not be reflected right away since it takes six to eight weeks for deliveries to get here,” she added.
During last week’s Cabinet meeting, Finance Secretary Margarito Teves announced that the National Economic and Development Authority board and the Cabinet-level Tariff and Related Matters committee had approved the reduction of the 7-percent tariff on these cold rolled coils (CRCs) and hot rolled coils (HRCs) to zero.
CRCs are raw materials used in the production of GI roofing sheets, while HRCs are used in the manufacture of CRCs.
An executive order should be signed and issued soon, Maglaya said in an earlier interview. Unlike other EOs, this would take effect immediately and would not have to wait until 15 days after publication.
The zero-tariff regime on CRCs and HRCs would remain in force as long as necessary, but would revert to 7 percent once Global Steel Philippines Inc., which aims to supply the local market with some of these raw materials, goes into commercial operation.
In an earlier interview, Maglaya said Global Steel had to prove to the DTI that it was indeed operating commercially before any recommendation to bring the tariffs back to 7 percent could be made.
“There should be continuous production, with enough inventories on hand if orders come. There should be proof of commercial production, probably orders or contracts for at least six months,” she said.
By Abigail L. Ho - Philippine Daily Inquirer - First Posted 21:13:00 06/01/2010
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