Steel stocks rally as govt extends safeguard duty on imports till 2028; JSW Steel jumps 5%

New Delhi: Steel stocks were in the limelight on Wednesday, with JSW Steel climbing nearly 5 per cent, after the government extended safeguard duties on imports of certain steel products for three years, aiming to curb dumping from countries like China and protect domestic manufacturers from a supply glut.

Shares of JSW Steel jumped 4.89 per cent, SAIL surged 4.18 per cent, Jindal Steel climbed 2.75 per cent, Tata Steel went up by 2.45 per cent, APL Apollo Tubes (1.48 per cent), and Jindal Stainless (0.15 per cent) on the BSE.

Following the rally in these stocks, the BSE metal index jumped 1.51 per cent to 36,811.73.

The 30-share BSE Sensex jumped 545.52 points, or 0.64 per cent, to settle at 85,220.60. The 50-share NSE Nifty soared 190.75 points, or 0.74 per cent, to end at 26,129.60 after four days of decline.

"The rally was led by steel stocks after the government imposed a three-year safeguard duty of up to 12 per cent on select steel imports, raising expectations of improved pricing power and profitability for domestic producers. JSW Steel surged up to 5 per cent, driving gains across the metal space," Gaurav Garg, Research Analyst, Lemonn Markets Desk, said.

The duties, first imposed as a temporary 12 per cent levy for 200 days in April, will now remain in force until April 2028, according to an official notification.

The safeguard duty will be levied at 12 per cent in the first year (April 21, 2025 to April 20, 2026), reduced to 11.5 per cent in the second year (April 21, 2026 to April 20, 2027), and further lowered to 11 per cent in the third year (April 21, 2027 to April 20, 2028).

Analysts said the shorter duration had created uncertainty among investors, and the new three-year window offers longer-term protection for domestic players.

Reacting to the development, Naveen Jindal, President of the Indian Steel Association (ISA), said the safeguard duty is a calibrated policy measure aimed at maintaining stability in the domestic steel market while ensuring continuity of supply for consumers and infrastructure projects.

"Sentiment across the metal space turned positive after the government announced a three-year safeguard duty of around 11-12 per cent on select steel imports, aimed at shielding domestic producers from cheaper overseas supply," Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said.