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MITI: Tariffs On Imported Steel Rise To 11% To 14% In Three Years

Shannxi Shew-E Steel Pipe Co.,Ltd | Updated: Apr 21, 2017

MITI: Tariffs on imported steel rise to 11% to 14% in three years

Malaysia ministry of international trade and industry ( referred to as the "MITI"), points out that the government has decided to rise tariffs on import Steel Concrete Reinforcing Bar (Rebar) , Steel Wire Rods and deformed steel pipe in Coils (SWR and DBIC) for another three years to protect the interests of local iron and steel manufactures business.

To note, the International Trade and Industry Ministry (MITI) announced that in accordance with Section 25 of the Safeguard Act 2006, the government had made a final decision to continue imposing these definitive safeguard duties following the conclusions of its investigations on the effects of increased importation of Rebar and deformed steel pipe on the domestic industry.

The investigations were previously prompted in May last year when the Malaysia Steel Association (MSA) filed a petition on behalf of the domestic industry alleging that the increased importation on both products into Malaysia had previously injured the domestic industry seriously.

Even if Chinese steel prices were to decrease as a result of slower construction activities in China, the research arm of Kenanga Investment Bank Bhd (Kenanga Research) reckoned that the import duties would still be highly effective in maintaining the attractiveness of local steel products.

The lower Chinese steel pipe imports would also allow local steel makers to maintain their margins in spite of higher raw materials costs in FY17 by passing the incremental costs onto end users instead.

According to MITI, the decision came into effect April 14 and for the first year, both Rebar, SWR and DBIC will maintain their import duties of 13.4 and 13.9 per cent respectively.

The rates will then decreased in subsequent years with rebar’s import duties reduced to 12.27 per cent on April 14, 2018 and 11.1 per cent on April 14, 2019.

Similarly, SWR and DBIC’s import duties will also be reduced to 12.90 per cent on April 14, 2018 and 11.90 per cent on April 14, 2019 

Overall, response of the development has been highly positive for local steelmakers as the safeguard measures will continue to deter imports and serve as an additional barrier for Chinese Steel pipe to our local shores”

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