India’s primary steelmakers have raised steel prices of flat products by Rs1,000-1,500/mt ($14-20/mt) for February deliveries in line with high international steel prices, according to Davis Index’s sources. Prices in long products segment remains unchanged.
This unexpected price rise comes days after the government, in its Union Budget 2021, announced reduction of basic custom duty to 7.5pc on various steel products.
State-owned company Steel Authority of India Limited (Sail) has hiked hot-rolled coil (HRC) prices by Rs1,500/mt ($21/mt). JSW Steel raised prices of certain flat products by Rs1,000/mt ($14/mt). Tata Steel raised HRC prices by Rs1,250/mt ($17/mt) for the month.
With latest price hike, primary mills’ HRC prices are around Rs55,500 ($761/mt) ex-Delhi and Rs56,000/mt ($768/mt) ex -Mumbai.
Market participants believe primary steel players raised prices in flat products amid positive sentiments post-budget expecting steel demand to be supported by the infrastructure plans announced by the government.
However, some are waiting for the Chinese Lunar New Year to be over on Feb 12 to see how the market will react. Whether this price rise in India is sustainable or not will be clear only after that. Industry leaders feel the recent cut in custom duty will be minimal impact.
Meanwhile, international iron ore prices shot from $80/mt in April 2020 to $173/mt on Jan 21 2021, touching a nine-year high before softening to its current level of $150/mt.