The domestic steel companies such as SAIL and Tata Steel are likely to increase prices by about Rs 600 a tonne, on account of the increase in excise duty in the Budget.
"With two per cent increase in excise duty, steel prices in the country may go up by Rs 500-600 per tonne," SAIL Chairman S K Roongta told reporters at a FICCI conference here.
JSW Steel Director Sales and Marketing Jayant Acharya said the hike in duty will impact only certain project-based consumers since other user industries will get it refunded.
Another private manufacturer Jindal Steel and Power (JSPL) maintained the increase would have to be absorbed by both the consumers and the steel makers.
"It will be difficult for the industry to pass on the entire amount to the consumer. I think the consumers and the the steel manufacturers have to jointly absorb about Rs
600 a tonne hike," JSPL Director Sushil Maru said.
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VISA Steel Chairman Vishambar Saran said: "Steel prices will have to go up by about Rs 600 a tonne otherwise steel industry would have to suffer."
Steel prices are already witnessing an upward trend on account of an improvement in demand from sectors like realty and automobiles.
"With government's emphasis on the infrastructure sector, the steel demand is bound to improve further," Roongta said.
Domestic steel prices are in the range of Rs 26,000-37,000 a tonne.