JSW, Essar expected to increase prices too, as coking coal prices continue to climb on reduced supplies
State-owned Steel Authority of India (SAIL) has increased the prices of long and flat products by Rs1,000 to Rs3,000 a tonne, effective 1st February, a SAIL dealer in the Western region told Moneylife today.
"We have got intimation from the company (SAIL) that prices of both long and flat products have been hiked between Rs1,000 and 3,000, effective from the first of this month," the dealer said.
Long products, such as bars and rods, are used in the construction sector, while flat products are consumed by automotive and consumer durables businesses.
Last month SAIL increased the prices of long products by about Rs2,000 a tonne and that of flat products by around Rs1,500 a tonne. Other Indian steel majors also increased prices between 4% and 5% on account of rising prices of inputs like coking coal and iron ore.
Rising prices of coking coal is continuing to put pressure on steelmakers to increase prices of their products to maintain margins. Coking coal prices have surged in the international market since supplies have been disrupted due to floods in Queensland, Australia, which is one of the largest suppliers of the commodity.
India imports about 70% of its coking coal requirements, and nearly 85% of that is from Australia. Coking coal prices in the spot market have climbed to a high of $300 per tonne, compared to $210 per tonne in December.
JSW Steel and Essar Steel are expected to follow in SAIL's footsteps.
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