Faced With Raw Material Price Hike, Both Primary & Secondary Steel Cos May Increase Rates Soon AUTOMOBILE-makers and construction firms could face another round of cost push from next month. Taking a cue from primary steel or hot rolled coil (HRC) makers, leading secondary steel producers, including Bhushan Steel and Uttam Galva, are also looking at raising prices of cold rolled coils (CRCs) and galvanised sheets by 15-20% next month. HRC is used for making CRC, which is primarily used in the construction and automotive sector. At present, while HRCs are priced at Rs 36,000 per tonne in the domestic market, CRC prices are hovering around Rs 41,000 a tonne. Primary steel players may go for another round of price hike in August to protect their margins on the back of soaring raw material prices, sources said. In the last four months alone, steel prices have surged by almost 30%. After the government's intervention in May this year, steel producers had rolled-back prices by Rs 4,000/tonne and promised to hold prices for a three-month period, which ends in the first week of August. Presently, domestic steel prices are Rs 15,000-20,000 lower than the international prices. However, Tata Steel managing director B Muthuraman on Wednesday said that the current price scenario is not sustainable as there has been an unprecedented increase in prices of raw materials. Moreover, ocean freights have touched an all-time high and robust demand for steel is fuelling metal prices globally. Others like Essar Steel and JSW Steel would also review prices early next month. Says JSW Steel director (finance) Sheshagiri Rao, "Price movements are a result of movements in companies' cost structure. We are surely going to review steel prices in August. But, we are yet to decide whether the price movement would be upwards or downwards.' Any upward movement in HRC prices would compel secondary steel makers to increase prices. "If primary steel firms go ahead with a price increase, we will also raise prices of our products as we will be under pressure with mounting price of everything from crude oil to iron ore, coking coal and electricity,' said Delhi-based Bhushan Steel director (finance) Nittin Johri. In the last 3-4 months, iron ore and coking coal prices have shot up by almost 8-10%. Moreover, high fuel prices have pushed up transportation costs for companies by 10-15% in the last one month alone.