With coal prices going up, Steel
producers will have no option but to pass on the hike to consumers. Coal India,
the largest coal producing company in the world, has switched to the
internationally-accepted Gross Calorific Value (GCV) based pricing mechanism
from the earlier Useful Heat Value (UHV) based system from January 1. As
against seven categories earlier, the company has categorised coal in 17 price
bands under the new pricing system.
According to steel manufacturer,
Steel plants in Chhattisgarh mostly consume D, E and F grade coal. Depending
upon their calorific value, coal of these grades has become costlier by 18% to
93%, which would lead to additional financial burden on the Steel producers.
Sponge prices in all major mandi
already start getting heat by Rs500-700/tone. As per manufacturer based in
Bilaspur (C.G.), coal linkage price will impact majorily for F grade Dipka
Colliery of SECL which will cost Rs2280 PMT against Rs 1100 PMT. Similarly
Gevra, Chhaal, Barod F grade will cost 2100, 1600, and 1400 per tone
respectively due to change in grading system.
SECL
officer however still refuses to clarify matter on new pricing methodology.
Steel prices in last week already started moving up with high raw material cost
and low finish demand.
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