JSW Steel, Tata Steel, Steel Authority of India, Bhushan Steel, Essar Steel, Jindal Steel & Power, and Rashtriya Ispat Nigam are among the top producers of the alloy in the domestic market
With iron ore prices on the rise and domestic demand expected to pick up from mid-April, steel producers have raised product prices by Rs 1,000 a tonne from March 15 and are gearing up for another hike by the same quantum from the next month.
“Domestic steel firms, at a closed-door meeting held 10 days ago, reached an understanding to unanimously raise product prices from April by another Rs 1,000 a tonne,” a source close to the development told Business Standard.
Domestic companies have raised steel prices by about 70 per cent since the imposition of minimum import price (MIP) on the alloy in February 2016.
Though prices were raised by Rs 3,000 a tonne in January, most companies had to roll back the hike the following month, either partially or completely, as the market was unable to absorb the revision due to weak demand.
However, the confidence of companies, that consumers will now digest higher prices, seems to be back.
“There has been a hike of Rs 1,000 a tonne in mid- March, and going ahead we will be raising product prices in line with the industry,” a source with Essar Steel said.
JSW Steel, Tata Steel, Steel Authority of India, Bhushan Steel, Essar Steel, Jindal Steel & Power, and Rashtriya Ispat Nigam are among the top producers of the alloy in the domestic market.
“Price revision decisions are taken depending upon market dynamics, and no meeting between steel producers was held to discuss prices,” said Jayant Acharya, director - commercial at JSW Steel.
“Having said that, with international and iron ore prices having moved up in the last few months, we will be taking a call on product price hikes later in the month. No decision has been taken as of now,” he added.
The steel industry is seeing a rise in demand -- mainly in the construction segment and auto and white goods sectors that were hit due to demonetisation -- after the Assembly elections.
In the last few months, as domestic steel demand failed to pick up, producers had to export the alloy to maintain margins and capacity utilisations. Average capacity utilisation of the domestic steel industry has moved to 85 per cent from 75 per cent earlier.
According to the Joint Plant Commitee data, India's April-February exports of steel have jumped 78 per cent year-on-year to 6.62 million tonnes, while imports have crashed nearly 40 per cent to 6.59 million tonnes.
Steel production for sale has increased 11 per cent to 92 million tonnes, while consumption was at 76.22 million tonnes, up 3.4 per cent from last year.
India has emerged as a net exporter of finished steel in February as well as during April-February.
Photograph: Mukesh Gupta/Reuters