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| Tata Steel ups rates by Rs 500-750 per tonne |
| BS Reporter / Kolkata Jun 20, 2009, 00:02 IST |
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Tata Steel has raised prices of hot rolled (HR) and cold rolled (CR) coils, used by the automobiles and consumer durables sectors, by Rs 500-750 a tonne. This is the first increase in HR in the last eight months.
A company spokesman said the increase was on monthly contracts and was effective from the June contract. The increase was being implemented in select regions of the country.
The earlier increase announced by Tata Steel was for CR and galvanized steel. Other steelmakers are adopting a wait-and-watch approach before deciding on increasing rates.
An Essar Steel spokesman said: “No decision has been taken. We are reviewing the situation.”
Anil Sureka, director (finance), Ispat Industries, also echoed similar views. “We are not doing anything this month. Next month, we will take a call,” he said.
Even Jayant Acharya, director (sales & marketing), JSW Steel, said: “We will review prices for the month of July.”
An industry source pointed out that most steel makers are waiting for the government to protect them. “We will wait for the hike in import duty,” the source said.
The industry is expecting a hike in import duty to 15 per cent. A proposal for imposition of safeguard duty, in the wake of cheap imports, is also pending.
Steel prices had fallen by almost 60 per cent from their peak levels in July 2008. Global HR coil prices, which were ruling at $1,100 in July last year, were down to $380 a tonne till last month.
However, prices have started recovering and the world’s largest steelmaker, ArcelorMittal, has increased prices in the last 10 days to $450 a tonne in the US.
The price hikes were stemming from the production cut announced across the globe. While most of the producers in India have normalised production, their global peers were still operating at less than 50 per cent capacity.
Industry sources said global steel producers were testing waters with a steep price hike, led by ArcelorMittal. If the market absorbed the price increase, then production could gradually normalise in the international market.
The domestic market was less affected than the international market. Domestic prices were higher than international prices before the recovery. But domestic steel producers were expected to increase prices significantly from next month, on the back of a global recovery as well as increased spending on infrastructure from the government, expected to be announced in the budget.
Domestic HR coil prices are at $496 a tonne at present.
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