Manufacturers’ organization IPMA calls for government intervention to regulate steel price hikes
The Indian Pipe Manufacturers’ Association (IPMA) has called for government intervention to regulate steel prices, which are trading at an all time high in India.
In a letter to Union Steel Minister Dharmendra Pradhan, the body also called for a temporary ban on its exports, a measure that will prevent steel players from diverting their products to international markets.
“Pipe makers and MSMEs have been struggling for a long time due to rising prices and shortage of steel in the domestic market. We had contacted your office (of the Minister of Steel) to request your kind intervention for regulate prices and impose a temporary steel export ban, “said the letter dated May 20, 2021.
The association said it also marked a copy of the letter to the offices of Prime Minister Narendra Modi, Minister of Trade and Industry Piyush Goyal, CEO of NITI Aayog Amitabh Kant, Secretary of Commerce Anup Wadhawan. , Secretary of the Department for Promotion of Industry and Internal Trade Guruprasad Mohapatra and Steel Secretary Pradip Kumar Tripathi, to brief them on these matters.
The IPMA said steel prices have risen by more than 60 percent in the past 10 months and are expected to rise a further 4,000 rupees / tonne in the coming days. This has made it impossible for downstream industries to exist which are totally dependent on integrated steel mills for their raw material needs, he added.
Several downstream industries have closed and many more are on the verge of closing, IPMA said.
Oil and gas and large infrastructure projects are responsible for economic growth and require good quality steel and its products, according to the agency. However, due to the increase in the price of raw materials, the cost of infrastructure projects has increased by more than 100 to 150 percent. This poses a great risk to our country’s infrastructure vision, he said.
An IPMA spokesperson said steel prices have been very volatile for the past 7-8 months. In some cases, like API classes (oil and gas lines), prices have risen more than 100-125% from where they were a few months ago.
The commercial quality itself has gone from 37,500 rupees per tonne to current levels close to 70,000 rupees per tonne and still rising, he said.
“This has severely affected our project-based business which requires some validity. Major steelmakers don’t give any validity for more than a few days because they want to cash in on upward price trends causing huge deviations and resulting losses. of the volatility of steel, ”the spokesperson told PTI by telephone.
This has put most of the pipeline laying and construction activity on a slow vein, reversing government pressure for faster infrastructure development, he said.
In the domestic market, steel is trading at an all time high. In May 2021, Indian steel players increased the prices of hot-rolled coils (HRC) from Rs 4,000 to Rs 67,000 and cold-rolled coils (CRC) from Rs 4,500 to Rs 80,000 per tonne. tonne.
While in the United States the price is around $ 1,500 per tonne, in Europe it is close to $ 1,000 per tonne.
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