Monday, 28 Mar
As summer season approaches various regions Hyderabad, Chennai, Mandi Gobindgrah, Jamshedpur & Orrisa are being hit by power cuts and rising cost of electricity..* With power cuts ranging form 4-12 hrs/day and to add to that Orrisa state electricity board increased power prices by Re.1 wiping out any benefits that would have accrued because of correction in the coal prices.
We saw the coal prices stabilizing at lower levels of $235/MT for the recent highs of $345/MT providing much needed relief for the industry, but this was a short lived relief.
Soon the prices started to move up and within a week’s time we saw steel prices moved up by Rs700-1200/MT and this price raise was out of compulsion rather than being backed by robust demand.
Prices might hold up for a few days because of load shedding, but with languishing demand what will happen when power supply is restored after the sowing season and mills start to run on higher capacity. What will the steel mills do when have a situation of over supply and they are paying more for critical input such as power.
Reported by Vikas Singh
Leave a Reply