SAIL takes the lead in cutting prices

Indian steel producers, led by the Steel Authority of India (SAIL), have finally given in to market pressure and cut prices by Rs 500-2000 a tonne.

A SAIL spokesperson said the new rates will come into effect from tomorrow.

Essar Steel too is cutting its price. "Building inventories and a glut in the international market are forcing steel players to cut prices," said an Essar executive. Although the company has not decided the extent of the cut, analysts expect it to follow the market trend.

Ispat Industries too is reducing its price. 'Price cuts will be announce in a day or two', said an official at the company.

Monnet Ispat managing director Sandeep Jajodia too hinted that his company could cut prices, saying: "We have to follow the market trend."

Defying the Market trend is Jindal Stainless, which is still upbeat with regard to the domestic demand and refusing to cut prices.

The company's director-finance, Arvind Parakh, said the bottom line of the company was healthy and, in spite of raw material prices shooting up, Jindal stainless would not cut prices.

The price cut by domestic players mirror's international trend.

South Korean steel giant Posco has already announced that it would lower prices of hot-rolled coil produced from mini-mills by 2.5 per cent to $ 567 per tonne from July. It also plans to cut prices of wire rods by 7 per cent.

Mittal Steel has already announced that it would be cutting its global steel production by 1 million tonnes in the third quarter to compensate for lower demand.

Arcelor, the world's second-largest steel producer, has also said that it would continue to cut output in the third quarter as it did in the first half.