Steel companies have increased steel price by ₹1,500-1,750 a tonne in January with strong demand from across sectors and a firm global demand. This is the highest price hike this fiscal.

Hot-rolled steel prices have been marked up by ₹1,500 a tonne in January to ₹37,500, though it is languishing below the ₹40,000 mark for last eight months.

Jayant Acharya, Director (Sales), JSW Steel, said that the price hike comes on the back of restocking by stockists and fresh offtake by automobile, white goods, packaging and infrastructure sectors.

“The sentiment in the manufacturing sector has turned bullish after proactive measures being taken by the government to revive the economy,” he added. Last November, steel manufacturers hiked prices for the first time this fiscal by ₹500-750 a tonne in November and followed this with another rise of ₹750-1,000 last month.

Steel prices had been falling consistently since April and touched a low of ₹32,500 a tonne in September from the peak of ₹45,000 a tonne late last year.

Globally, steel prices have gone up by $90-100 and is expected to have an effect on Indian steel prices. So far, steel companies in India have hiked prices by ₹5,000 a tonne despite lingering economic uncertainties.

On the back of rising steel prices, iron ore mining companies are demanding a hike in iron ore prices. Acharya said that the negotiation with the iron ore miners are not yet finalised and the quantum of hike has not been finalised.

He said that coking coal prices are trading stable at about $140 a tonne FOB (free on board or all inclusive) from Australia. Meanwhile, long steel product traded on the Indian Commodity Exchange has been hitting the upper circuit for last few days.

Ajay Kumar, Director, Kedia Advisory, said that steel long futures contract on ICEX has been trading firm as the global steel price setter Beijing has laid out plans to bolster its economy.

In 2020, China plans to invest 800 billion yuan ($114.38 billion) in the railway system, 1.8 trillion yuan in highways and waterways, and another 90 billion yuan in the civil aviation. Stockists and retailers stepped up purchases in anticipation of mills hiking offer prices.

There are market talks that large integrated mills may use the global trend of rising steel prices to justify a January price hike, despite sluggish consumer demand for long products in India.

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