India’s primary steel mills are likely to increase prices in Mar by between Rs500-800/mt ($7-11/mt) due to a rise in input costs and domestic demand from infrastructure projects picking up. The price increase is for March deliveries.
Another reason for the price hike is Covid-19, which has impacted China trade, providing an opportunity for Indian mills to fill in the export void.
JSW Steel announced an increase in prices of flat products by Rs800/mt, and long products by Rs500-600/mt, depending on grade, from March 2020.
Other primary mills like the Steel Authority of India (Sail) and Tata Steel are likely to follow suit.
Indian primary mills have been raising steel prices since November 2019. Rebar prices are now at Rs40,000-40,500/mt in Mumbai ex-stockyard, up from Rs34,000-34,500/mt mid-Nov, 2019.
Rise in input costs
India’s integrated mills expect margin pressures in the current quarter due to a price rise in imported coking coal, further compounded by a weaker rupee against the US dollar. On Feb 27, rate of INR against USD was Rs71.70. The exchange rate was Rs71.17 to $1 on Feb 5.
Premium low volume hard coking coal prices are now at $157-160/mt fob Australia, which were at the $150 level in the beginning of February.