Wednesday, June 01,
Major steel players in India are anticipating a hike in flat product by Rs 600-1000/MT in the month of June. Soaring prices of raw material in international markets has compelled domestic steel manufacturers to pass on the increases to its consumers.
JSW Steel, India’s third biggest steel producer, is likely to increase prices by Rs 600 per tonne on flat products to mitigate the high input cost on margins.
Confirming the move, Seshagiri Rao, joint MD, JSW Steel & Group CFO, said that a decision on the quantum of increase would take place by Wednesday. “The increase is primarily on account of soaring raw material prices globally. Coking coal, which accounts for about 50 % of steel production cost, has gone up to $335 per tonne from $220 per tonne, so the raw material cost pressure is quite high,” he said.
Companies may not pass the entire cost to consumers owing to the already high interest rates and inflation, which could hurt demand. However, it would be to the extent to mitigate the impact of high input costs on their margins, an official in a steel company said.
An Essar Steel spokesperson said; “On the back of rising input costs and strengthening of the international prices over the last couple of weeks, there is a case for upward revision of steel prices.” However, he did not elaborate on the exact price hike that company is considering.
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