The Hindu Business Line : Secondary steel makers hike prices by Rs 3,000/tonne

New Delhi, June 2 While the Government has been able to restrain the major domestic steel producers from increasing prices to contain inflation, secondary steel makers have raised prices of their products following increase in international prices in the last 15 days.

Market sources told Business Line that prices of semi finished steel such as ingots and billets have increased in the range of Rs 2,500 to Rs 3,000 a tonne.

According to officials in major steel producing companies, the spurt in prices has come in the last seven to 10 days.

Branded TMT bar manufacturer Kamdhenu Ispat has increased prices by Rs 3,400 a tonne taking the present selling price to around Rs 44,000 a tonne, sources said.

Simultaneously Rathi Ispat has also raised prices by approximately Rs 2,000 a tonne.

Industry officials attribute the increase to rise in international prices which have gone up significantly across all products and because of depreciating rupee value against dollar.

“International hot rolled coil prices were quoted at $1,050 a tonne on last week and on Monday the quotations have crossed the $1,200 mark,” steel makers said.

“International prices of steel melting scrap have increase by around $110 a tonne from $630 a tonne last week to $740 a tonne on Monday. It is the main raw materials for ingot makers, mostly using the electric furnace route. Added to that is the depreciation in rupee leading the companies to raise prices of semi finished steel products like ingots,” officials in companies using the electric arc furnace route said.

Sources in Kamdhenu said that “We were buying ingot at Rs 28,400 a tonne on May 20 and today we are buying it at Rs 33,000 a tonne.”

Similar items manufactured by Tata Steel and SAIL command a premium of around Rs 2,000 to Rs 2,500 a tonne, industry officials said.

Overall, in major north Indian wholesale markets like Mandi Govindgarh, Bhiwandi and Ghaziabad, billet prices have gone up by around Rs 2,500 a tonne, ingot by Rs 2,000 to Rs 3,000 a tonne and unbranded TMT bar prices by Rs 1,500 to Rs 2,000 a tonne, market sources revealed.

However, there is a price differential in the range of Rs 500 to Rs 800 a tonne between these three markets mainly because of freight cost, sources pointed out.