Steel prices fell to three year low; industry awaits demand pick up

Price outlook for steel making raw materials are also on the decline

Steel prices, especially of hot-rolled coil (HRC), have dropped below ~35,000 a tonne against the backdrop of demand slowdown. This is a 19-week consecutive fall. Analysts say this will impact the bottom line of steel majors, including Tata Steel and JSW, as major companies’ gross margins in the past 19 weeks have dropped by around ~6,000.

Companies are hoping for a revival in demand, which, so far, has proved elusive. A source in Essar Steel told Business Standard, “Volume sales are being managed by giving discounts to customers. But realisations are low and not in our (steel producers’) hands. Steel