Ministry of Commerce And Supplies - Enhanced Integrated ...
Ministry of Commerce And Supplies - Enhanced Integrated ... Ministry of Commerce And Supplies - Enhanced Integrated ...
N T I S2010Attractive Markets for Silver Jewelry (HS 7113.11)Top 10 by size, growth, openess and current exportstop10 top10 current exports from NepalRank top10 SIZE top10 GROWTHOPENESS(US$ 1,000 in 2008)1 USA Denmark Tajikistan USA 2,7082 Hong Kong (SARC) Netherlands India Canada 8573 Germany Australia Kyrgyzstan France 8554 UK Spain USA Italy 4915 Japan Hong Kong (SARC) Japan Japan 3686 France France Iceland Netherlands 2987 Spain Germany Denmark Switzerland 2578 Australia USA Germany Germany 2469 Denmark UK Canada Ukraine 6110 Canada Thailand Italy UK 5710) Iron and Steel ProductsBackgroundModern steel products manufacturing plants based on imported raw materials began to be set up in Nepalsince the early 1980s. There are currently around 50 plants in operation with a total capacity of 2 milliontons and with an estimated total investment of more than US$100 million. Most of the plants serve domesticmarket requirements. Around ten of the largest plants also sell their products to India and Bhutan.There is no manufacturing of steel in Nepal. The production is based on imported steel coils, steel sheets,wires, etc. Thus, the added value of the industry is rather low in relative terms, but very high in absolute termscompared to most other sectors covered in this study. Gross export of steel products in 2008 was aroundUS$150 million. Practically, all trade, both imports of raw materials and exports, is with India, but some exportalso goes to Bhutan.Index 1: Export PerformanceTable 2.34Export Value of Iron and Steel Products, 2004-2008 (US$1,000)Mirror data 2004 2005 2006 2007 2008Exports overseas 251 273 343 831 1,447Exports to India 54,910 48,694 36,110 80,507 147,983Total exports 55,161 48,967 36,453 81,338 149,430Source: TradeMap (mirror data).NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT73
N T I S2010Types of Exported Products: The main items of export include (a) cold rolled steel sheets; (b) galvanizedcolour-coated steel sheets; (c) black galvanized steel pipes; (d) black galvanized wires; (e) steel structures: preengineeredbuildings, transmission and telecom towers, steel bridges, etc.; (f) telescopic and tubular poles forpower and telecom sectors; and (g) bicycle rims.Current Export Destinations: According to official trade data from importing countries, practically all exportgoes to India, with negligible export to Bhutan, Egypt, and Japan. According to information directly obtainedfrom exporters, Bhutan is an important market for Nepalese steel products and some export has also beenmade to other countries, e.g. Tanzania.On average 10 per cent of the total production of higher value added products like GI and pre-coated sheetsare being regularly exported and mainly to neighbouring markets in India and Bhutan. One of the surveyedcompanies exports almost 75 per cent of the total sheet production to Indian and Bhutanese markets andother companies export similar shares of their wire production. Recently, Bhutan Power Corporation hasgiven an order for electrical poles to the tune of 15,000 MT.Potential Export Destinations: Respondents see some potential in African markets.Dynamism of Exports: Exports have grown fast in recent years and have almost tripled since 2004. However,one reason for that is certainly the increasing cost of raw materials.Index 2: World Market ConditionsTable 2.35Total World Export Value of Iron and Steel Products(HS chapters 72+73)2004 2005 2006 2007 2008393,527,488 456,050,992 539,355,488 682,594,896 826,689,312Source: TradeMap.World Market Prospect: The world market for iron and steel products has been very dynamic, but this alsoreflects the increased prices in raw materials. Average unit values for export of iron ore have quadrupledbetween 2003 and 2008 and have increased further since. Additional increases can be expected from theupcoming change of the contract system that was announced in March 2010. But these developments do notdirectly affect the Nepalese steel industry because Nepal is not ‘selling’ steel but only processing steel. Whatis more relevant for Nepal is the demand for steel products from its potential export markets, in particularIndia. India’s demand for steel products has been very dynamic in recent years and, with a forecasted annualgrowth of construction in the next few years, this will certainly remain so.Market access conditions: Nepal would enjoy no preferential access in almost all markets when comparedto the tariffs faced by major competitors. The only exception is India. India applies a 5-10 per cent duty onimports of iron and steel products, but provides free access to Nepal.Index 3: Domestic Supply ConditionsProducers: There are around 50 plants in operation and around ten of them are currently exporting. Mostof the production is, however, for the domestic market. Some of the firms operate under joint venture withIndian companies.74NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT
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N T I S2010Attractive Markets for Silver Jewelry (HS 7113.11)Top 10 by size, growth, openess and current exportstop10 top10 current exports from NepalRank top10 SIZE top10 GROWTHOPENESS(US$ 1,000 in 2008)1 USA Denmark Tajikistan USA 2,7082 Hong Kong (SARC) Netherlands India Canada 8573 Germany Australia Kyrgyzstan France 8554 UK Spain USA Italy 4915 Japan Hong Kong (SARC) Japan Japan 3686 France France Iceland Netherlands 2987 Spain Germany Denmark Switzerland 2578 Australia USA Germany Germany 2469 Denmark UK Canada Ukraine 6110 Canada Thailand Italy UK 5710) Iron and Steel ProductsBackgroundModern steel products manufacturing plants based on imported raw materials began to be set up in Nepalsince the early 1980s. There are currently around 50 plants in operation with a total capacity <strong>of</strong> 2 milliontons and with an estimated total investment <strong>of</strong> more than US$100 million. Most <strong>of</strong> the plants serve domesticmarket requirements. Around ten <strong>of</strong> the largest plants also sell their products to India and Bhutan.There is no manufacturing <strong>of</strong> steel in Nepal. The production is based on imported steel coils, steel sheets,wires, etc. Thus, the added value <strong>of</strong> the industry is rather low in relative terms, but very high in absolute termscompared to most other sectors covered in this study. Gross export <strong>of</strong> steel products in 2008 was aroundUS$150 million. Practically, all trade, both imports <strong>of</strong> raw materials and exports, is with India, but some exportalso goes to Bhutan.Index 1: Export PerformanceTable 2.34Export Value <strong>of</strong> Iron and Steel Products, 2004-2008 (US$1,000)Mirror data 2004 2005 2006 2007 2008Exports overseas 251 273 343 831 1,447Exports to India 54,910 48,694 36,110 80,507 147,983Total exports 55,161 48,967 36,453 81,338 149,430Source: TradeMap (mirror data).NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT73
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