CR, galvanised steel price hike on cards

After an increase in hot-rolled coil (HRC) prices a fortnight back, cold rolled (CR) and galvanised products are set to increase over the next two days by Rs 1,000-2,500 per tonne.

Uttam Galva Steels, the country's second largest galvanised steel manufacturer, today announced an increase of Rs 1500 a tonne on prices of all its galvanised steel products.

The company has also increased prices across all its other product categories comprising of cold-rolled steel and steel by-products by Rs 2, 500 per tonne.

With the increase, the standard GC 40 grade galvanised steel is quoted at about Rs 38,000 a tonne, ex-Mumbai. Only about a fortnight ago, major galvanised steel producers had announced a price hike. Most of them, including Uttam Galva and JSW, had hiked prices by an about Rs 1,500 to Rs 2,000 a tonne.

Ispat Industries is considering a Rs 1,000 a tonne increase, effective March 16 across CR and galvanised products. Sources said the company could consider another increase of Rs 1,000 per tonne beginning April.

Jindal South West is also planning to increase prices by around Rs 1,000-1,500 a tonne over the next two days.

Seshagiri Rao, chief financial officer, Jindal South West said, the main reason behind the hike was good demand in the international market.

Galvanised product prices had increased by around $100 per tonne in the last 30 days and CR by $80-90 per tonne.

Rao said, Jindal South West's pricing policy was to review HRC prices at the beginning of every month and CR and galvanising prices in tandem with market conditions.

The main reason behind the price hike was the galloping zinc prices, one of the key input materials. Zinc prices had scaled up to $2,500 a tonne compared with $800 per tonne only 14 months back.

Tata Steel, however, said the company was not considering any price hike.

CR and galvanised steel producers had staggered the price hike over the last few months. Mid-February, producers increased prices by around Rs 1,500 a tonne.The average galvanised prices was at Rs 35,000 per tonne.

The CR and galvanised price increase came after the HRC price rise. At the beginning of March, steel majors""long and flat product manufacturers""raised HRC prices in the range of Rs 500-2,000 a tonne, on the back of a firm-up of demand in the domestic and international markets.

India produces about 4 million tonne and consumes about 1.5 million tonne of galvanised steel. In the recent past, steel mills around the world added new capacities in a big way to meet the anticipated rise in demand in the near future.