HR steel price hike round the bend

International hot rolled (HR) steel prices have gone through the roof, with the US market reporting prices of around $750 - $780 per tonne, reflecting a jump of at least $100 in the last ten days.

Industry sources said that a price increase in the domestic market is on the cards, however, they declined to specify when it would be implemented as companies had already tied up contracts for the next couple of months.

They further added, "Price increases could be in the region of Rs 1,000 per tonne, pushing the domestic hot rolled coil price towards the Rs 30,000 per tonne mark."

Domestic steel majors have not announced any price increases as yet. A senior company executive of a leading steel making company said, "We will take a call on prices in the next couple of days."

Analysts said, "Steel companies may not announce a direct price hike, they might withdraw discounts and price incentives currently offered, resulting in an effective hike of around Rs 1,000 per tonne."

A steel dealer in the city said, "Long product prices are expected to go up by around Rs 1,500 in the next few days as supplies are very tight due to good demand."

Meanwhile, in Europe, HRC prices are in the region of $630 - $650 per tonne, with China still lagging behind around $580 per tonne.

Analysts tracking the sector said, "This time the steel price increase is not led by China. It is difficult to predict a situation when China starts picking up more supplies, leading to a further shortfall in the global markets."