Indian Raw Material hike prices by Rs. 2500 to 2700 per tonne in December. According To a report, HRC (Hot Rolled Coil) prices have strengthened in the international market by nearly 18% in the last two months leading to a significant increment in the Indian steel prices. Steel, metals, and other raw material price hike leads to the product (developed by them) price hike.
With a great hike in hot-rolled coil’s prices, the benchmark steel product (such as electronic control panels) is expected to go up further during the month by at least Rs 1, 500 a tonne. After the December price hike, the prices of raw materials (steel, metal, and hot-rolled coil) currently stand at Rs 48,300 per tonne. According to Steel Mint, the current price of raw materials is around 32% higher than that of July 2020.
According to ISA secretary-general, the international prices flowed to over USD 750 per tonne from the bottom of USD 397 per tonne witnessed this year. As India is an open economy, the steel prices in the country move up with the global prices. In the period of June-December 2020, the price of iron ore has increased more than double from Rs 1,960 to Rs 4,160 per tonne. With an increase of Rs 1,000 in iron ore prices, the minimum impact is Rs 2,000 per tonne in steelmaking products.
Due to the unpredicted COVID-19 pandemic, the Indian steel industry faced severe disruptions in production which are now leading to a significant rise in the products such as control panels. Therefore, many steel companies in India with sub-optimal operating capacity represented significant cash losses due to the non-absorption of huge fixed costs for the quarter ended June 2020.
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