The recovery in steel prices, which rebounded from a 20-year low, has ground to a halt. Successive price increases since March this year pushed prices of hot rolled coils (HRC) from Rs 11,500 in January-February to the present ruling price of Rs 16,500.
The dramatic price rise can mainly be attributed to a pick-up in demand and reduced inventories. However, the sharp price rise has attracted increased supplies and monthly global steel production hit a 36-month high in May 2002.
But, all good things must come to an end and in tandem with this philosophy, last month HRC prices dipped by $5 in west European markets. But, immediately one of the largest steel makers, Arcelor stepped in to announce that the company would hike prices in coming months and in the year to come.
Predictably, demand surged as consumers resorted to some hurried buying. As a consequence, decline in steel prices was arrested and prices came back to the original level.
With markets becoming increasingly global, the situation back home was no different.Prices were arrested and HRC continued to sell at around Rs 16,000 per tonne.
While producers were looking at further prices increases, trade sources said,
