Steel prices could rise or fall by Rs.2,000-2,500 a tonne mainly due to fluctuation in prices of raw materials in the next six months, Steel Secretary Atul Chaturvedi said here on Thursday.
“The industry has assured us that the steel prices will see a 5-7 per cent plus or minus movement from the current levels in the next six moths,” Mr. Chaturvedi told reporters after a meeting with steel companies. “We have not asked them to cut steel prices,” he added.
Steel companies like Tata Steel, SAIL, JSW have increased the prices of their products by about Rs.6,000 a tonne since February. Concerned over the price rise, Steel Minister Virbhadra Singh had asked Mr. Chaturvedi to hold a meeting with the domestic steel companies. “Prices have increased but not reached a stage which is alarming,” Mr. Chaturvedi said.
Mr. Chaturvedi said the government was primarily concerned over the prices of TMT bars, used mainly in construction activities. The prices of TMT bars have now risen by about 25 per cent to around Rs.38,000 a tonne.
The Ministry could soon hold a separate meeting of secondary steel producers, who have about 80 per cent market share of TMT bars, he said. Present on the occasion, SAIL Chairman S. K. Roongta said the prices of his company's hot-rolled coil, a vital steel input which is further processed for use by many industries, were at about Rs.37,000 a tonne. SAIL did not anticipate a price hike in May, he added. “The current price levels are fine,” he added.
Mr. Chaturvedi expressed hope that iron ore and coking coal prices could come down after peaking at certain level. Iron ore prices are hovering in the range of $120-160 a tonne level, up 90 per cent from last year, and coking coal at $200-a tonne mark at present, higher than 50 per cent from last year's level.
“If raw material prices continue to rise it can see demand dipping at some point.... Steel price hikes should not be driven by speculation,” Mr. Chaturvedi added.
However, Mr. Roongta said, “There is enough steel available in the country. I do not see any price hike due to speculation.”
When asked if input cost will further go up in next few months, JSW Steel Director (Sales and Marketing) Jayant Acharya said the raw material prices, which are supplied under quarterly contracts now, were seeing some pressure.