Most steel makers announce price cuts

Tata Steel to maintain prices till March 2005.

Steel Authority of India Ltd (SAIL), Essar Steel, Jindal Iron & Steel Company (Jisco) and Ispat Industries slashed prices today. And Tata Steel, which had announced price cuts yesterday, said it would not raise the prices of its products till March 2005.

B Muthuraman, managing director, Tata Steel, said, "We will not increase the prices for both our direct as well as retail customers till March 2005."

The price cuts by primary steel producers are expected to bring down the prices of domestic hot-rolled coils to the range of Rs 27,000-28,000 per tonne.

While SAIL has reduced the prices of both its flat and long products by Rs 1,000 per tonne, without excise duty considerations, Essar Steel announced a price cut of Rs 560 per tonne in the hot-rolled coils segment, inclusive of excise duty.

Ispat Industries also reduced hot-rolled coils prices by Rs 500 per tonne, which is exclusive of excise. On the other hand, Jisco's Rs 600 per tonne reduction in the price of hot-rolled coils is inclusive of excise duty.

VS Jain, Chairman, SAIL said: "In the present scenario, price reduction by SAIL will have a positive impact in lowering domestic steel prices. We hope that the benefits are passed on to ultimate consumers. We shall review the position time to time."

Taking into account the impact of excise duty and sales tax, the effective reduction in prices would be about Rs 1,150 per tonne, he said.

Essar Steel Managing Director Prashant Ruia said: "The price reduction takes into account the differential cost structure of various steel producers, as Essar does not have captive iron ore or coal mines or control over fuel costs, which some of the other producers have."

The current price reduction would not only provide stability to the domestic market but also give competitive advantage to consumers of flat products, as even today domestic flat product prices were significantly lower than the prevailing international prices, he added.

Vinod Mittal, managing director, Ispat Industries said,  "It is expected that various manufacturers involved in raw material supply such as iron ore, pellets, scrap, sponge iron should ensure that sufficient quantities of raw material needed for manufacturing steel should be made available to the domestic producers instead of exporting these."