Steel users rue rise in prices of hot rolled coil

The Federation of Tiny and Small Industries of India and its affiliate associations said the increase in the prices of hot rolled coils, MS rods and nickel had crippled micro enterprises.

Steel consuming industry has also rued the continual rise in steel prices. Industry representatives apprehend major losses for the industry if the situation is not controlled.

While the price of steel rounds has reached Rs 29,000 per tonne, the rate of sponge iron has gone up from Rs 14,000 per tonne to over Rs 17,000 per tonne in less than three months.

Badish K Jindal, general secretary, Wire Drawing Federation of Punjab, said large steel manufacturers had not affected any reduction. "There is a dire need to control steel prices," he said.

Joginder Kumar, president, Federation of Tiny and Small Industries of India, said the increase had been quite high and crippled micro enterprises, which would lead to massive unemployment in the coming days.

"The government needs to conduct raids on hoarders of non-ferrous metals who have increased rates of these metals," he said. particularly nickel, which has touched an all-time high of Rs 2,550 per kg from Rs 600 per kg within a very short time," he added.

Attributing the rising prices to cartels, the export of steel, high Customs duty on imported steel scrap and manipulation by producers, industry representatives said rates were increasing on a daily basis creating panic among the steel consuming industries.

PD Sharma, president, Apex Chamber of Commerce and Industry, said steel scrap in the international market was mainly procured by Pakistan, Bangladesh and Vietnam as they had reduced the Customs duty from 8 per cent to zero.

"The steel scrap in the international market is selling at $350 per tonne. If the government of India reduces Customs duty from 5 per cent to zero, it will affect a reduction of around Rs 1,000 per tonne, which will give sufficient relief to steel producers and in turn, to the remaining steel consuming industry," he added.

He also demanded that custom and CVD on scrap be abolished and central excise duty be brought down from 16 per cent to 8 per cent. Custom and CVD on nickel should be abolished and import be allowed at zero per cent since nickel is 100 per cent imported raw material, said the member.

Urging the government to take a serious note of the problem, he said it was important to control prices to save light engineering industry of Punjab, which is already facing recession on account of increasing input costs on one hand and tax benefits to industry in neighboring states on the other.