July 1, There appears to be no let-up from a weak steel market. Producers are contemplating downward price adjustments for July, though some think they can manage.
We are yet to decide, but may roll over,” said Jayant Acharya, Director (Sales and Marketing), JSW Steel. Another cold-rolled steel producer said prices could be cut by Rs 1,000-2,000 a tonne.
Prices of hot-rolled coil (HRC), a benchmark for flat steel, used by automobile and white goods makers, are Rs 32,000 a tonne, down by Rs 2,000 over the past month.
Excess capacity, coupled with a weak demand, appears to be the triggers. The only way the downward spiral could be stopped was by cutting production, said a producer. “We produced 30 per cent less this month than the previous, but the industry needs to do it,” he said.
India’s production capacity is 60 million tonnes and most companies are at 100 per cent capacity. The global capacity utilisation ratio, however, slightly declined to 82 per cent from 83.4 per cent in April, according to the World Steel Association.
Source : Business Standard
Leave a Reply