Indian flat steel prices may see a sharp increase in September. Prices are expected to rise by Rs 1000-1500/MT ($15-23) due to:
- Hike in International Flat Steel prices
- Rise in cost of coal import
- Decline in flat steel import
Currently, ex-works prices of HRC are in the level of Rs 34,000-35,000/MT (Basic, ED, tax extra) and prices trading in retail market are in the range of Rs 39,000-40,000/MT (Inclusive of ED, taxes extra).
International steel prices are also inching up with China reporting a 9.3% jump in factory output in July. Prices at this point in china are hovering USD 595/MT (INR 38,500), which have seen a surge of 2.5%, stands at around USD 15/MT (INR 975) as compared to the prices last week, while export prices are standing firm at USD 540/MT (INR 34900) FOB Shanghai on account of less buying from Asian countries.
Today JSW Steel, country's largest private sector player said it will raise prices of steel by 5% at the beginning of September 1, 2013 due to the high cost of coal import, which has increased by Rs 1500 crore due to depreciation of Rupee being the major reason.
Since January, the rupee has fallen 16% and since July 1, it has slipped to 4.5%. While iron ore prices have jumped from $ 129.5 to $ 144 per tonne at present, coal prices have moved up from $ 125/tonne since the end of June to around $ 136/tonne currently.
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