The Hindu Business Line : Steel companies assure to hold prices this month

Ispat has decided to restrict supply to secondary producers for exports, while increasing supplies to domestic users to force retailers to sell at lower prices.

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New Delhi, July 1 Major steel producers on Tuesday met officials in the Ministry of Steel and said that they will not increase prices in July.

However, they expressed serious concerns over the fact that steel prices at the retail level have started moving up during the last seven to 10 days.

In a statement issued after the meeting, the country’s largest steelmaker Steel Authority of India Ltd (SAIL) said that the company “has received reports, including reports in the print media, regarding increase in the market prices of steel during June 2008, particularly during the last week”.

Stating that SAIL had maintained its prices for the domestic market during June at the same level as that of May and will maintain the same price level for July also, the release pointed out that the company had increased supplies to the domestic market by 32 per cent in June this year compared with June last year.

The growth in sales in June for TMT bars and hot rolled coil stood at 74 per cent and 20 per cent, respectively.

SAIL supplies

For the April-June quarter, SAIL’s supplies of TMT bars, hot rolled coils and galvanised plain/corrugated sheet to the domestic market have gone up by 55 per cent, 16 per cent and 30 per cent, respectively.

All categories taken together, SAIL’s supplies to the domestic market have gone up by approximately 9 per cent during the first quarter, the release said.

Similarly, Ispat Industries too, in a statement issued here today, said that “it has been brought to (our) notice that prices of some of the steel products have again started rising in the retail market in the last 7-10 days”.

Restrict export supply

In order to control prices in the retail segment, Ispat has decided to restrict supply to secondary producers for exports, while increasing supplies to domestic users and initiate measures to force retailers to sell steel products at reduced prices, the release said.

“These moves could bring down hot rolled steel prices by around Rs 2,000-2,500 a tonne at the retail level,” an official in Ispat said.