Cut rates if global prices fall: Govt to steel industry...

The government today asked steel producers to slash prices whenever there was softening of rates in the global markets.

"Global steel prices have already softened and if the trend continues, it calls for a reduction in the domestic market too,” said Steel Secretary PK Rastogi.

Globally, the demand for steel has come down, especially from the infrastructure sector, resulting in a dip in prices.

“The gap between domestic and international steel prices has reduced. If the gap narrows further, we may look at revising our prices downwards,” said SAIL Chairman SK Roongta. He added the PSU was maintaining the price line as of now.

The domestic steel producers have been holding the price line for over three months to help the government check inflation.

Rastogi said steel prices had been kept on the hold by the producers and the government would step in if there was a hike. “The government has options, we will examine the case if the prices are increased,” he said.

On the issue of long-term supply contracts, he said the government was seeking a long-term agreement between steel producers and miners.

“Efforts of the government are aimed at securing a long-term contract (for supplying iron ore) between miners and steel producers,” he said, when asked about the agenda of the meetings scheduled between steelmakers and miners.

The first meeting would take place in Bangalore today and the other in Kolkata on August 27.

When asked about the reported increase in retail prices of steel in spite of the government’s efforts, Roongta said, “SAIL has a network of dealers at te district level. They are maintaining the price line.”

When asked if the contribution of the commodity in the wholesale price index (WPI) has increased in the last one week as inflation peaked to a 13-year high of 12.63 per cent, the steel secretary said, “The inflation was higher this week. Steel’s contribution to inflation has remained constant for past two weeks.”