Domestic steel makers have jacked up prices by Rs 1,000-2,000 a tonne across the product basket from this month to offset the rising pressure on margins due costlier raw materials, sources said.
"Almost all private sector steel makers have raised the price from the beginning of current month to pass on inflated production cost to consumers," an official of a leading private sector steel maker said.
Following the hike, the price of hot rolled coil (HRC), the benchmark steel product, went up to Rs 41,500 a tonne from Rs 39,500 per tonne earlier.
Steel makers generally hike prices in tandem to remain competitive.
JSW Steel had in late January announced that it would raise the price between Rs 700-Rs 1,200 a tonne for current month citing a steep rise in domestic iron ore prices.
"We are being forced to raise prices after taking a hit of nearly Rs 900-1000 per tonne on the cost of production in December 2013," Jayant Acharya, Director (Commercial and marketing), JSW Steel had earlier told PTI.
Industry sources said that rupee depreciation and the gap between international and domestic prices also prompted them to raise prices. Steel makers had in January this year also hiked price by up to Rs 1,500 per tonne.
They said the cost of iron ore has gone up substantially as a result of non-availability of the key steel-making raw material as per the requirement.
Against a production limit of of 2.5 million tonnes (MT) in Karnataka, only around 1.6 mt is coming to market, leading to an abnormal price increase, they said.
Uncertainty over the Shah Commission report on Odisha has also added to the problem, they added.
Karnataka and Odisha are two leading iron ore producing states in the country.
