Large Indian integrated mills have commenced hiking base prices across flat product categories with immediate effect, in the second increase in less than a week and the third in less than 30 days, and so as a result domestic base prices for February deliveries have increased above expectations, SteelOrbis learned from industry circles on Friday, February 3.
The price increase for flat products effected by some mills for February delivery coils was around INR 1,750/mt ($21/mt) compared to the previous announcement done by these mills just early this week. At the same time, in comparison to the level seen in early January, base prices have added INR 3,250-3,750/mt ($39-46/mt), officials said.
Following the increase, effective base prices for JSW Steel Limited are at INR 59,500/mt ($724/mt) ex-works for hot rolled coil (HRC) and INR 66,500/mt ($810/mt) ex-works for cold rolled coil (CRC). Effective base prices for AMNS’ HRC and CRC are the same as the previous prices.
The sources said that other mills like Steel Authority of India Limited (SAIL), Tata Steel and Jindal Steel and Power Limited (JSPL) are expected to effect similar base price increases over the next two to three days.
They said that domestic steel mills are increasing prices in reaction to the positives of the national budget presented before the Indian parliament on February 1, which proposed a 36 percent increase in infrastructure capital expenditure for the fiscal year 2023-24, a capital expenditure outlay of INR 2.40 trillion for national transporter Indian Railways (IR), the highest-ever figure, and a 66 percent increase in capital outlay for construction of affordable housing.
At the same time, domestic mills have been steadily increasing export allocations in the wake of improving realizations from key markets like the EU and, with mills already operating at optimal capacity, this would entail a further tightening of supply volumes for domestic sales and thereby offer further headroom for price increases.
$1 = INR 82.50