SAIL cuts prices by up to Rs 2,000 a tonne

The country's largest steel maker, Steel Authority of India (SAIL), today said it has cut prices of its long products — used primarily in construction — by Rs 1,500-2,000 per tonne and may further lower the rates if the situation so warrants.

"We have brought down prices by Rs 1,500-2,000 a tonne on July 1 on our long products. Monsoon is setting in, so construction activities will come down. If the market situation demands, we will bring the rates down further," SAIL Chairman S K Roongta said on the sidelines of the Assocham steel summit.

However, the steel maker said it will continue with the withdrawal of the Rs 500-750 per tonne rebate announced on the flat steel products — mainly used by the automobile and the consumer durable sectors — last month.

Steel giant Tata Steel, which raised prices of some of its products last month by Rs 500-750, said there is no scope for increasing prices of the commodity in the near term and the domestic prices will continue to move in tandem with the global trend.

"Indian steel prices will be in tune with the global trend. If the global trend goes down, it will go down and if the global trend is up, the prices will go up. In the short term, there is no scope for us (Tata Steel) to increase prices," Tata Steel Managing Director B Muthuraman said.

State-run RINL may also consider reducing prices "in a day or two". However, it sees stability in domestic steel prices at the moment.

"I see stability in prices at the moment. We deal in long products only. There can be 2-3 per cent revision in our prices, maybe upwards or downwards, in day or two," Rashtriya Ispat Nigam Chairman and Managing Director P K Bishnoi said.

The country's largest private steel maker by capacity, JSW Steel, had yesterday ruled out increase in prices of its products mainly on account of lower input cost pressure.

Steel companies have negotiated coking coal contracts at lower rates and expect to sign iron ore deals at a huge discount in the current fiscal over the last one.

Lower steel prices have hit hard the margins of domestic companies. Steel prices plummeted from the peak of $1,150-1,200 a tonne to $500-550 a tonne in the past three quarters due to the slump in demand in the wake of the global economic slowdown.