Steel prices in India are on the rise due to the rapid increase in the rates of key input material, coking coal, according to industry executive Bimlendra Jha. Coking coal and iron ore are the primary raw materials used in steel manufacturing. While India has abundant iron ore resources, the majority of its coking coal needs are met through imports from countries such as Australia and South Africa.

Jha, Managing Director of Jindal Steel and Power (JSP), stated that coking coal prices have surged significantly, currently trading at USD 341 per tonne CFR (cost and freight) India, up from USD 230 per tonne in June-July 2023. This rise in coking coal prices has led to an upward movement in steel prices, and the industry has had to pass on these increased costs to consumers.

According to SteelMint India, the cost of hot-rolled coil (HRC) per tonne was Rs 55,200 in June, and it has increased to Rs 58,800 as of Thursday after price adjustments.

Jha also noted that the steel market is experiencing a 7-8% increase in demand, following a period of decline, especially during the monsoon season. Steel is one of the top three most widely used metals, and fluctuations in its prices have a significant impact on the entire value chain.