The main cause of the higher international steel prices is China’s export restriction. Most of the Chinese steel today is consumed locally, which leads to a scarce supply in world trade. Calcutta: The record high price of steel may not let up in the second half of the current budget as demand is expected to increase amid the ongoing second wave of the pandemic which has resulted in the demand outlook remaining weak and uncertain in the first half. The rating agency BWR announced on Friday. The prices for hot / cold rolled coils (HRC / CRC) have recently been revised upwards by around 5,000 rupees per tonne to 70,000 rupees and 83,000 rupees per ton respectively.
However, the domestic prices for steel are 15 to 20 percent lower than the steel prices imported on land.
“Demand in the automotive sector is expected to increase in the second half of the year during the festival season, with deliveries currently on the waiting list due to production bottlenecks. An upturn can also be seen in the construction and real estate sectors. So there doesn’t seem to be any need to keep steel prices down in the near future, “Brickwork Ratings (BWR) said in a sector note.
The bull run on prices not only leads to an explosion in costs for infrastructure, real estate projects, consumer goods and a renewed rise in automobile prices, but also increases the input costs of engineering SME exporters who also use steel as an input material.
The temporary curtailment of Indian production due to the diversion of oxygen for medical purposes, the rise in raw material prices of iron ore by around 4,000 rupees per ton, and increased freight costs due to higher diesel prices are other reasons for the hardening of local prices recently, a BWR said Official.
The main cause of the higher international steel prices is China’s export restriction. Most of the Chinese steel today is consumed locally, which leads to a scarce supply in world trade.