BOC urged to probe steel import undervaluation

MANILA, Philippines - Philippine Iron & Steel Institute (PISI), the umbrella organization of the steel industry associations, has written to Bureau of Customs (BOC) Commissioner Rozzano Rufino Biazon to investigate 15 companies for supposed gross undervaluation of their steel imports in March.

In a statement, PISI asked the BOC to use world market prices for steel billets and hot rolled coils as reference values for all importations of finished steel products.

PISI said that using the semi-finished products as base prices for BOC’s Revision Orders (ROs) on steel product pricing would help the bureau in achieving its target collections as well as to further identify incidences of undervaluation in the importation of iron and steel. 

PISI said that several importers declared their steel shipments at values less than the world market price for scrap metal at $400 per metric ton.

“PISI supports the pronouncement of the BOC that it is now investigating alleged cases of steel wire rod undervaluation — a bold step towards curbing incidences of technical smuggling, which is robbing the government of needed revenues while creating unfair competition in the market between importers and domestic manufacturers,” the statement said.

The group also asked commissioner Biazon to subject to the same scrutiny all steel importations, particularly those that fall below the value of scrap metal, as mandated by Customs Memorandum Order 3-2012.

PISI said that at least 15 companies had steel importations that were way below the prices of scrap metal and steel raw materials like HRC and billets in March.

In the group’s letter to Biazon, the 15 companies were identified as Hoyugoh Steel, Ocean Canning, Joyland Industries, Davao Forever Steels Forming, Herco Trading, Eglinton Import-Export, SB Construction and Water Treatment, Hornet Enterprises, Voowher Five Trading, NMW Enterprises, Ikkinari Enterprises, Ashes & Diamonds Marketing, Richflow Trading, MegaFoundation International and Thanatos Enterprises. — Czeriza Valencia

The 15 companies, based in Davao, Cebu, Metro Manila and Subic, collectively imported 6,531 MT of finished steel products at an average declared value of only $317 per MT. Last March, the price of scrap metal was $400 to $420 /MT, while that of HRC and billet was above $600/MT.