The Hindu Business Line : Spot steel prices start moving up

Trade sources said that this is because they are expecting another round of price hikes by major steel producers in the public sector such as Steel Authority of India Ltd (SAIL) and Rastriya Ispat Nigam Ltd (RINL) and also the private sector manufacturers.

Sources in SAIL told Business Line that “the company has effected 5 - 7 per cent price hike in long-term negotiated contracts with effect from June 1.

But spot prices are increasing because the demand is high and dealers are raising their margins.”

“As far as we know the private sector companies too have increased their prices,” SAIL officials said.

However, the major producers in the private sector such as Essar Steel, Ispat Industries and Jindal Steel said that, “we had given in writing to the Prime Minister that we will hold prices during the first quarter.” “Is it possible for us to go back on our word?” an official in Ispat Industries said.

In April, the steel companies had promised the Government that they will not increase prices in order to contain inflation. However, on the ground prices have moved up significantly.

Prices of 2 mm hot rolled coil has gone up from Rs 46,000 per tonne to Rs 47,200 per tonne in Delhi, from Rs 47,840 to Rs 49,400 in Chennai and from Rs 44,500 to Rs 44,750 in Mumbai, according to official figures available with the Joint Plant Committee (JPC) under the Ministry of Steel.

Prices of most steel products such as pig iron, pencil ingots, wire rods, rounds, tor steel, angles, plates, hot rolled coils and cold rolled coils have been moving up during the past few days, sources in the JPC said.

Trade sources pointed out that prices in Delhi and Chennai are higher when compared to Mumbai.

“This is because major private sector players such as Ispat and Essar are closer to Mumbai, while for the Delhi and Chennai markets the freight cost is higher,” they said.