Essar Steel may raise prices by Rs 1,000/tn next month

Private steel firm Essar Steel is likely to raise product prices by around Rs 1,000 per tonne next month on the back of rise in input costs and demand uptick during the past two months among others.

"Essar Steel is likely to raise product prices by around Rs 1,000 per tonne next month. This is primarily cost push along with some demand uptick in the fourth quarter," according to a source.

The steel firm has also seen rise in demand for exports in recent months and expects the momentum to continue, the source said.

"If you see the steel prices in the global market, they have firmed up by around USD 20-30 in recent time. So, that will reflect in the domestic prices soon," the source said.

The company officials could not be contacted.

Earlier, JSW Steel said it had raised product prices up to Rs 750 per tonne to absorb the rising cost.

While steel companies have increased prices three times in the past few months, industry experts are sceptical about its complete absorption by the market.

"Given the weakness in the steel consumption, it remains to be seen whether such price hike is sustainable," Jayanta Roy, senior vice-president and co-head, corporate sector ratings at Icra, said.

Essar Steel, which is fully integrated flat steel manufacturer, has a capacity of 14 million tonne per annum with presence in India, Canada, the US, West Asia and Asia.