Prices in the domestic market are increasing because there is a demand pull, and internationally, prices have gone up.
In the last 10 days, steel companies have increased prices by about Rs 2,000 a tonne on the back of a rise in domestic demand and international prices, taking them to near-pre-Covid levels.
There have been two rounds of increase, since the end of July, said industry sources.
Jindal Steel & Power (JSPL) managing director (MD) V R Sharma said the market had bottomed out.
“There have been two increases since the end of July.
"In the past two weeks, pellet and iron ore prices have both increased by about $10 a tonne and scrap prices by $25-30 a tonne,” he added.
So, higher input cost is an additional factor driving prices.
Industry sources pointed out that after the latest round of increase in August, prices would be lower than the March levels by about Rs 1,000 a tonne.
JSW Steel director, commercial & marketing, Jayant Acharya, said: “The gap between international and domestic prices was 7-8 per cent.
"Over July and August, we have been able to cover 6 per cent. But we are still below international prices.
"Imports of hot rolled coil (HRC) from China are at $500-510 a tonne and domestic prices are still below that level.”
“Prices in the domestic market are increasing because there is a demand pull, and internationally, prices have gone up.
"Incrementally, we are getting back to shape,” he added.
HRC prices reported a steady fall from Rs 38,000 a tonne to Rs 34,750 a tonne in June due to weak demand.
However, since July, prices started moving up. A producer said there was high export order load and mills were not operating at full capacity with most major producers touching 80-90 per cent.
Photograph: Adnan Abidi/Reuters