JSW Steel cuts steel prices for October

Despite rise in input costs and higher duty on import of coking coal, JSW Steel Limited today announced cut in the prices of steel products for the month of October. The company has cut Rs 500-750 per tonne for flat products and Rs 1,000 per tonne for long products.

This is the second price cut in the long products announced by the company in the last one month. The reduction in prices comes in the wake of sluggish demand for steel products and cheap imports flooding the market, a top company official said.

While flat steel products are widely used in the automobile and consumer durable goods sector, long products are mainly used in the construction and infrastructure sector, which is currently witnessing sluggish demand.

"We have been witnessing increase in the cheap import of steel products, especially the TMT bars are imported in the guise of alloy bars from China. The imported products are cheaper by at least Rs 5,000-6,000 per tonne compared to the domestic prices. The volatility in currency, which has depreciated by 1.6 per cent in the last one month has caused lot of difficulty for the steel makers," Jayant Acharya, Director-Commercial and Marketing, JSW Steel told Business Standard.

Between April and August this year, the country has imported 3.2 million tonnes, a growth of 23% over the corresponding period last year. In the month of August alone, imports were to the tune of 870,000 tonnes. Overall, for the first half of the current fiscal, imports are likely to be in the order of 4 million tonnes, he said. "Compared to exports of 2.5 million tonnes during the first five months of the current fiscal, the country has emerged net importer of steel products during the period," Acharya said.

He said the steel industry has raised an objection with the government on import of cheap quality steel and urged for imposition of some safeguard duties. "The dumping has to be stopped in the interest of the domestic steel industry. We have taken up the matter seriously with the government," he said.

JSW Steel's sales volume is impacted to an extent in the first six months of the fiscal, he said adding that in the first quarter of the fiscal, the company sold 2.88 million tonnes of steel products. "With the price cut, we expect pick-up in demand post-Diwali," he said.

Most of the other primary domestic steel producers have not raised prices in the past couple of months.


                                                                                                                             
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