The Hindu Business Line : Steel products: Dealers for direct sale from plant

Visakhapatnam, April 21 The Visakhapatnam Steel and Cement Dealers’ Association has appealed to the Visakhapatnam steel plant authorities to sell steel products directly to them at the plant level to eliminate middlemen and to bring down steel prices in the market.

At a press meet here on Monday, Mr K. Ganesh, President, and Mr N. Venkateswarlu, Secretary, said the distribution system being followed by the steel plant was a faulty one and of the total steel production of 3 million tonnes (mt), 1 mt was being sold through middlemen (long-term contract holders) and the latter were charging a hefty margin. Therefore, the steel retail prices were ruling high, as the long-term contract holders were adding Rs 5,000-15,000 to the plant price and as a result the steel dealers were unable to provide steel to customers at reasonable prices.

They complained that several times in the past they had sent petitions to the steel plant authorities to change the system, but to no avail. In the context of the uproar over rising steel prices, it was imperative to change the system at least now and the Visakhapatnam Steel and Cement Dealers’ Association had passed a resolution on Sunday evening to that effect, they said.

They said the retail steel prices in the local market could be brought down by Rs 10,000 a tonne, if the steel plant agreed to sell steel directly to them. At present, they said, the long-term contract holders were buying steel at Rs 35,000-40,000 a tonne from the plant and selling at Rs 55,000 or so. They said they would strive to change the system.

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