Finally, good news for all the Steel users, who had been churning in between the high prices of steel. The government has instructed the domestic steel makers to cut the prices if the global prices deprive further. Due to slowdown in demand of the material, the international steel prices have come down to $ 950 - $1000 per tonne from $1300 a tonne.

P K Rastogi, steel secretary informed, “Global steel prices have already softened and if the trend continues, it calls for a reduction in the domestic market too.”

The analysts feel that steel industries will have to lower the price as they are being pressurized by the government and also due to international prices which have lowered too. However, the steel firms yet have to take the final call on prices next month. There had been a fall of about 10-15% in the last month in the prices of global steel.

AS Frioz, an independent steel and natural resources consultant, expressed, “Steel prices have been facing a downturn globally and therefore there’s no reason why domestic steelmakers should increase prices. Also iron ore prices, a key input of steel, have dropped 15% in the international market, which is also preventing metal prices from shooting up further. We expect prices to remain more or less stable till December this year.”

The steel companies had slashed prices by Rs 4,000 per tonne in the month of May and had ensured government that it would hold prices for three months. Though the term ended earlier this month, the steel companies had decided to hold the prices so that government can better fight inflation. The official data reveals that 21% of contribution is added by steel and steel products in the process of inflation.

According to JSW Steel director (finance) Seshagiri Rao, “We don’t intend to raise prices currently as prices have softened globally. But, we are yet to review next month’s prices. We’ll reach a consensus only after examining all the parameters.”

The government has also started mediating between iron ore producers and steel manufacturers to build long-term contracts and ensure security at reasonable rates in an effort to keep metal prices under scrutiny.