MANILA, Philippines - The removal of the seven percent tariff on Cold Rolled Coils (CRC) and Hot Rolled Coils (HRC) has offset the planned increases in the price of steel in the market but it does not guarantee that there will be no more increases in steel prices should world prices go up.
The National Economic Development Authority (NEDA) board has approved the recommendation of the Tariff Commission to reduce the tariff to zero in order to cushion the impact of rising ore prices in the world market.
Trade Undersecretary for Consumer Welfare Zenaida C. Maglaya said that the move of the government to remove the tariff has allowed steel producers to delay their plan to increase their price by three percent.
However, she cautioned that any more increases in the world market prices may cause local prices to go up. Steel prices are determined quarterly.
Maglaya said that the NEDA board has already approved the removal of the tariff. She reported that they are now waiting for the executive order to be completed. Once signed she said they will be asking for immediate implementation after publication.
The Tariff Commission has reduced the tariff to zero because according to the agreement between Global Steel and the government, a tariff of seven percent will be imposed on imported CRC and HRC provided they can meet at least 50 percent of the local demand. Global Steel has been unable to meet the requirement. The seven percent tariff will be restored if and when Global Steel will be able to follow the Executive Order which requires that the firm meet local demand.
Earlier, the Filipino Galvanizers Institute (FGI) said they will be holding off their planned five percent to 10 percent price increase in prices because should the DTI lower import duties, the impact of higher import prices on the cost of galvanized iron (GI) roofing sheets will be lessened. CRC is the material for the production of GI sheets. HRC is used to produce CRC.
The galvanizers said they will be increasing GI sheet prices to offset the higher cost of raw materials brought about by continuing increases in the cost of iron ore and related products in the world market.