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Surge in raw material cost pushes steel prices to new high in April

The increase in raw material prices provoked significant steel organizations to hike prices in April following two progressive months of hikes.

JSW Steel, ArcelorMittal Nippon Steel India (AM/NS India), and Jindal Steel and Power (JSPL) are among the top private area steelmakers that have expanded costs of hot-rolled-coil (HRC) – a benchmark for level steel – by Rs 4,000-5,000 a ton.

JSW Steel and JSPL, which are into long items, have expanded rebar costs by Rs 2,250-3,000 a ton, respectively.

The information from SteelMint shows the cost of HRC after the increment remains at Rs 79,000-79,500 a ton for JSW Steel and AM/NS India ex-Mumbai. Updated JSW rebar costs are at Rs 73,000-73,500 a ton ex-Mumbai and JSPL rebar at Rs 76,000-76,500 a ton ex-Delhi. As indicated by a SteelMint expert, list prices have outperformed past highs.

JSW Steel Director (commercial & marketing) Jayant Acharya said the organization had expanded costs by 3-5 percent across long and flat items however it was just partly taking care of the cost impact.

“The coking coal that we bought in April will go into the April-May production. So May-June are likely to be peak in terms of cost of production,” he explained. “Cost push from the raw material side is a concern and we are hoping that it will correct down. It has started correcting to some extent and it is likely to correct further over the next couple of months. That will bring the cost of steel down. But till the time there is an increase of cost in the system, which we will have to see how to navigate, some of the costs will have to be passed on,” Acharya said.

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