This will allow the steel mills to not only hold on to the price hikes they took earlier this month but also possibly paves way for further hikes, said people in the know.
Until recently, imported steel was available at a significant discount to locally produced steel as suppliers from countries like Japan, China, Vietnam and South Korea allegedly dumped their products into the Indian market amidst weak global demand. However, with mills around the world now hiking prices, the differential between the landed cost of imported steel and the one produced in India has reduced significantly. This has allowed local steelmakers to hike their prices too in tandem. Meanwhile, domestic mills are also getting an important market in terms of exports where realisations are higher as steel prices move upwards globally.
Indian steel mills have hiked prices of benchmark hot-rolled coils of steel by nearly 7% since the beginning of the year to around Rs 60,700 per tonne, data from SteelMint show.