Unfavourable market conditions for steel at domestic as well as international markets are impacting prices of the commodity for the past few months. And despite the Government’s decision to withdraw export duty on steel products and iron ore, there is no considerable demand for it and thus steel prices are falling continuously.
On Monday, the steel TMT bars of 8 mm thickness were traded at the price of Rs 48,000/tonne (excluding 18 per cent GST) while 10-25 mm thickness bars saw a price of Rs 47,000 per tonne (excluding 18 per cent GST). Interestingly, the prices dropped by Rs 4,000 per tonne since November 19 when the Government withdrew export duty on steel. The current level of steel prices has dropped to its eleven months low.
The Government move was supposed to create additional demand for the commodity and push up the prices. However, the prices are falling and the experts feel that the trend may continue for at least a couple of weeks.
Rajesh Sarda, President of Steel and Hardware Chamber of Vidarbha, told The Hitavada that there is poor demand for the commodity. “Buyers are very cautious at this point in time and most of them are expecting further dip in the prices and hence they are not buying steel,” he said.
Ideally, the steel prices go up soon after Diwali when construction activities start picking up. “But in the current situations, construction activities are yet to gather pace and thus there is no good demand for the commodity,” said another steel manufacturer, requesting not to disclose his identity.
“There is poor demand for steel in the international market, especially for the steel produced in India. We are buying raw material at a very high price because of which Indian steel manufacturers cannot compete with others. In addition to this, the cost of raw material and power are also affecting the India steel producers. We will have to wait and watch how things unfold in the near future,” he added.