ISA not to revise steel prices till June

With the Indian Steel Alliance, a body of steel manufacturers, assuring to keep the steel price at the current level till June, users in the state have heaved a sigh of relief. Builders, contractors and manufacturers of engineering goods had gone on strike to protest against the heavy rise.

The ISA has also decided to meet the aggregate demands of hot-rolled coil (HR coil) for 'small consumers.' Almost all users in the state fall under this category.

Meanwhile, the Federation of Real Estate Developers Association of Gujarat (FREDAG), has called-off its eleven-day old strike, following a minor reduction in the prices of steel.

Builders and contractors from all over the state had been boycotting from construction in protest against the frequent hike in steel price.

"The ISA has made a commitment to users that the price will not be revised until June. Moreover, for users who enter into contracts of a quarterly, half yearly or yearly periods with the ISA, the prices will remain unchanged," said Dilip Chenoy, deputy director of CII, which is the secretariat for ISA.

Chenoy said that the two major issues - availability and pricing - , have been taken care of. "Steel will be exported only after domestic demands are met in full," he added.

Gujarat Builders Association president Harshad Patel said that in Ahmedabad alone, work on 1,000 small and big construction projects have been stopped. "In the whole of Gujarat, there could be well over 5,000 projects that had been affected," he said.

Patel said that the builders are more concerned about the steel manufacturers forming a cartel and increasing prices unilaterally. "If this stops, then the natural rise in steel prices can be cushioned," he said.

The ISA however contended that the current steel price are realistic and that users have failed to see that the increase in price is an end-result of the rise in input costs. The average input cost for the industry has climbed up by over 300 per cent in the past few months, ISA added.

The international price of coke, a key input material in the manufacture of steel, has gone up by over 280 per cent in just two months. From $120 per tonne in December last, the price of coke has risen to $465 a tonne in February 2004.