At present there is no inflationary concern: Virbhadra Singh
Major steel producers Steel Authority of India Ltd (SAIL), JSW and Essar on Friday increased prices of their products by up to Rs. 2,500 a tonne due to rising input costs in a move that could make automobiles and consumer durables costlier.
“We have increased steel prices in the range of Rs. 2,000-2,500 a tonne mainly due to rise in raw material prices,” Steel Authority of India Chairman S. K. Roongta told reporters on the sidelines of the SAIL Open Golf Tournament here.
Private Steel makers JSW Steel and Essar Steel too confirmed hiking their prices.
World's sixth largest steel producer Tata Steel, however, said it has not yet taken a decision on raising prices.
JSW Steel Director Sales and Marketing Jayant Acharya said the company had increased the prices of its products by 5-7 per cent and would review the rates again in mid-April to fix the prices for the next month.
An Essar Steel spokesperson said, “The price increase is in the same range as of other steel producers. It is mainly due to steep rise in raw material prices.”
The increase in prices by the companies is effective from April 1.
On the rising steel prices in the domestic market, SAIL Chairman said India would follow the rising global trend where the rates have gone up due to increase in prices of iron ore and coking coal.
Asked about the government's view on rising steel prices, Steel Minister Virbhadra Singh said, “There has been a spurt in steel prices recently but it is a temporary phenomenon and at present there is no inflationary concern due to that.” Coking coal supply contracts are reported to have been signed between Japanese steel mills and Australian miners — Rio and BHP — that acts as global benchmark at about $200 a tonne for April-June 2010, against last fiscal's $105-130.
Speaking on the sidelines of the SAIL open golf tournament here, Mr. Singh said there was an urgent need to secure raw material resources abroad and for that the government was in the process of restructuring the special purpose vehicle, International Coal Ventures Ltd. (ICVL), which was formed for scouting and acquiring such assets.
On the proposed follow-on public offer of State-owned SAIL, he said, “The proposal is now expected to be placed in the next Cabinet meeting for its approval.”