Steel prices likely to increase by Rs 8000-10000 per MT due to increase of coking coal by 200$/MT in last 4 weeks, there by net increase of Rs 15000/-MT of steel.
Same period Iron ore prices were down by 1500/- per MT landed. Net saving due to iron ore price reduction may be Rs 2200/- per MT. These coking coal contracts are for November deliveries,
Net Iron ore and Coal required to produce 1MT of Steel shall be 400$ ( coal) and 130$ (iron ore) + 50$ /MT ( for Gerri alloy) of Carbon grade + 100$ Production cost . Means Liquid metal cost of Carbon grades shall be 680$ /MT
By November theoretically steel prices in India should go up by Rs 160 $/MT. (Rs 12000/ MT. Even if steel mills forgo their margin by Rs 4000/- MT still net increase required on account of raw materials are Rs 8000/- Per MT which May come in 2 lots first in October 4000/- and 4200/- by November