Indian steelmakers are likely to retain their pricing power as
competition from lower-priced imports recedes amidst rising global steel prices.
This will allow the steel mills to not only hold
on to the price hikes they took earlier this month but also possibly paves way
for further hikes, said people in the know.
Until recently, imported steel was available at a
significant discount to locally produced steel as suppliers from countries like Japan, China, Vietnam and South Korea allegedly dumped their products into the
Indian market amidst weak global demand. However, with mills around the world
now hiking prices, the differential between the landed cost of imported steel
and the one produced in India has reduced significantly. This has allowed local
steelmakers to hike their prices too in tandem. Meanwhile, domestic mills are also getting an important
market in terms of exports where realisations are higher as steel prices move
upwards globally.