Barely a day after the country's automobile companies posted stellar sales performance in August, at least three major steel-makers have increased prices for this month by 3-4 per cent, with the rest likely to follow suit in the next few days.
Steel prices have been on the rise since December 2009 as the consuming sectors have gone into overdrive. A sluggish global economy however saw the commodity prices decline in May, which had an impact on prices in India as well.
Now, global steel prices are again on the rise.
"Prices had come down in June and we had said then that prices have bottomed out. It remained stable in the next two months," said a senior official at JSW Steel. "We are increasing the price this month as costs have gone up and international prices are also firming up."
The country's largest steel-maker, public sector Steel Authority of India, has cut discounts on its flat products by Rs 1,000 a tonne and a further increase in price could be in the offing.
Flat products are used by automobiles and consumer durables sectors, which are expected to see strong sales in the festive months ahead.
Ispat Industries, Bhushan Steel and Essar Steel have also raised prices by around R1,000 per tonne to maintain import parity.
"Indian prices are still much lower (than international prices)," said Vinod Garg, executive director, Ispat Industries.