Steel Companies Hike Prices By Rs 1500 A Tonne
A day after the Union budget slashed customs duties on a gamut of steel products with the aim to rein in escalating domestic prices, steel producers in the country have increased prices by Rs 1,000-1,500 a tonne. Primary producers such as state-run Steel Authority of India Ltd (SAIL) raised prices of benchmark hot rolled coil prices as well as cold rolled items. Private player JSW Steel also raised prices by Rs 1,000 a tonne on certain products. Other large producers are likely to follow suit. While reacting to the budget proposals, primary producers had pointed out on 1st February that the duty cut would have limited impact on domestic prices given that steel prices across the globe were firm. Moreover, around 60 per cent of imports come from countries with which India has free trade agreements such as Japan and Korea. In short, these imports can anyway come at zero per cent duty even before the budget move. Steel prices in the domestic market have rallied nearly 50 per cent from the low it fetched in July, backed by a robust domestic demand and buoyant international prices. Benchmark HRC is now hovering around Rs 54,000 a tonne. The budget had cut duties by 2.5-5.5 per cent on a range of products. It also temporarily suspended countervailing duties and anti dumping duties on certain products coming from a few countries, notably China. User industries also pointed out that the impact of the reduced duty would not be felt here before 2-3 months. It would at least take that long if someone contracts steel today to reach his factory. Till such time, mill prices in India would rule firm. Rising steel prices are putting pressure on the user industries, especially those who have entered into long term contracts with buyers, in India or overseas.
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