Steel prices to decline by five per cent in three months: CMIE

Steel prices in the Indian market are expected to fall by around 5 per cent in the next three months, says Centre for Monitoring Indian Economy.

"The expected dip in contract prices of iron ore and coal will put pressure on steel prices. We expect prices to decline by around 5 per cent in the next three months," CMIE stated in its review of Indian economy for June.

Steel makers in the domestic market have asked the ministry to hike import duty on the alloy to 15-20 per cent from the current 5 per cent, or impose safeguard duty of about 25 per cent.

"Any restrictive measures to curb imports, if implemented, will narrow the gap between the domestic and international prices to a maximum of 7-8 per cent. This indicates that prices have not bottomed out yet," CMIE said.

Tata Steel has increased its product prices by up to Rs750 per tonne after increased better domestic demand and firm global trends. Last month it had hiked long products prices by Rs300-500 a tonne.

Steel prices had corrected by 40-45 per cent for six months upto April 2009 and then stayed constant in May.