KARACHI, March 12: The substantial increase in valuation rates of imported steel materials notified by the Customs has invited importers wrath who said the unilateral move would make the materials costlier by Rs9,000 per ton.

The Directorate General of Customs Valuation on Thursday (March 11) issued a circular regarding determination of value of flat rolled iron and steel products i.e. hot rolled coil, cold rolled coil and galvanised plain sheets (secondary quality) under section 25A of the Customs Act 1969.

The directorate said that the value of these items was determined vide Valuation Ruling on 9.07.2009 and the said ruling was taken up for revision as prices of these items were showing upward trend.

It said meetings with all stakeholders were fixed for 16.11.2009, 7.12.2009, 30.12.2009 and 18.01.2010 but no one attended. However the final meeting was scheduled for 3.3.2010 informing them that no further adjournment would be granted and the value would be decided ex parte on the basis of available record.

The March 3 meeting was only attended by the representatives of Pakistan Steel, Model Customs Collectorate (Appraisement), MCC PACCS and MCC Port Qasim.

The representative of Pakistan Steel Mills contested the discount being allowed to arrive at the price of secondary quality products and proposed a discount of five per cent on the price of prime quality published in reputed journal.

“We do not agree to this increase and are filing an appeal for the review of this ruling,” Shamoon Bakir Ali, President, Karachi Iron and Steel Merchants Association (KISMA) said.

When asked why he did not attend the meetings, he said the association attended only the first meeting held on November 16, 2009, but the traders gave their point of view in March 8 and 9 meetings.

He said he had proposed for raising valuation price by $30 per ton but the Customs had enhanced the rates by over $230 per ton.

He was of the view the Directorate General of Customs Valuation had taken the decision to support Pakistan Steel, which meets only 10 per cent requirement of steel products.

The value for hot rolled coils (all origins secondary quality) were fixed at $626, cold rolled coils at $682 and galvanised sheets at $776 per ton (C&F), according to Shamoon Ali the rates were $390, $450 and $527 per ton respectively.

The customs directorate said that importers were provided opportunity to give their point of view but they chose not to avail such opportunity and instead tried to delay revision of values as the international prices were showing rising trend.

However, after close of meetings, some of the importers stating to be representing their associations came to say that existing values as determined vide earlier Valuation Ruling may be maintained.

The customs added that the import data was examined. Physical import clearance data of prime quality hot and cold rolled coils and galvanised sheet is available. These items are used mainly for further working and fabrication of angles, flat bars, terminal tanks, bodies of machinery, pipes for water and oil for used in industry, overhead water tanks, electrical equipments etc.

In order to determine justifiable discount on secondary quality of goods over prime quality, price list issued by Pakistan Steel Mills has been consulted which indicates that they categorise secondary quality products in two categories secondary A and secondary B.

Their pricing mechanism indicates that secondary A quality products are charged one per cent below respective thickness wise prices of prime quality products. In some products, they charge two per cent below the price of prime quality products. Similarly secondary B quality products are charged 10 per cent less than the price of prime quality products of respective dimension and year of manufacture.