Steel companies bow to Paswan's wishes

Firms effect partial rollback of prices.

At the behest of the steel ministry, steel producers on Thursday offered a price cut in the range of Rs 500-1,000 a tonne.

Industry leaders declared the price cut with immediate effect following their meeting with Steel Minister Ram Vilas Paswan here on Thursday.

"The steel minister expressed concerns over the impact of rising steel prices on the common man. We explained the pressure from the rising cost of inputs like iron ore, coal, gas, crude oil, rail and sea freight. However, a voluntary decision has been taken to roll back prices and moderate the impact on consumers," said Naveen Jindal, executive vice-chairman and managing director, Jindal Steel and Power, on behalf of the steel producers.

The price of TMT bars and rounds have been cut by Rs 1,000 a tonne, while hot rolled coils have been made cheaper by Rs 500 a tonne.

Most steel producers had increased prices by an average Rs 2,500 a tonne with effect from February. In January, prices were hiked by an average Rs 500 a tonne.

Steel producers also put forward their demands for lower excise duty and railway freight on steel. "All producers want the excise duty to come down to 8 per cent from 16 per cent at present," said Jindal.

"We are concerned with the impact of rising input costs on the profitability of steel producers. Our ministry will write to the finance ministry to lower the excise duty from 16 per cent and to the railways ministry to reduce freight charges," said Paswan.

Jindal said the price cut would not adversely impact his company's profitability since the reduction was minor. However, he added that if raw material prices rise further, the company would be compelled to pass the burden on consumers.

"The price hike has impacted users and industries. We support the minister's efforts to moderate the impact," said S K Roongta, chairman of Steel Authority of India (SAIL), the country's largest state-run steel producing company.