Team News Riveting
On the first day of every month, the market anxiously watches the steel sector as major players normally increase the price. But it did not happen in September.
Going by the indications in the industry, the steel producers may announce the price in the next few days. And if they have their say, it will cross Rs 40,000 for a tonne of steel.
Experts said that prices had been increased by Rs 2,000 a tonne and it would be around Rs 40,750 per tonne in the days to come. The steel price was Rs 38,750 per tonne in August.
The domestic iron ore prices had surged past pre-Covid levels. Since June, iron ore price in the major producing state of Odisha had increased by 58 per cent while NMDC prices had gone up by 40 per cent.
A price increase this month would take steel prices to cross even the pre-Covid levels and surpass Rs 40,000. It would however be still much below the peak level of Rs 46,000 achieved in November 2018. Steel prices at the end of August were at Rs 38,750 a tonne. Before Covid-19, it was 38,000 in March this year.
A number of domestic user industries, including infrastructure, are showing strong demand trends which have also led to the price increase.
However, in the exercise, the secondary players suffer the worst. It accounts for 55 per cent of India’s total steel production and is facing glitches in iron ore supply even as some companies started ramping up production in July to nearly 100 per cent.
Miners” body FIMI has urged the government to introduce a mechanism to monitor the price and sale of domestic steel, which has witnessed a steep rise in recent months.
According to the Federation of Indian Mineral Industries (FIMI), the hike in the prices of steel is leading to “windfall gains by few steel players” at the cost of the entire Indian economy, including upstream mining industry and downstream user industries.
