Steel prices fall sharply on subdued demand outlook

New Delhi: Futures prices of steel on National Commodity & Derivatives Exchange Limited (NCDEX) have softened significantly in the past one to one-and-a-half month period.

Prices came down from its recent peak of around Rs 61,000 per tonne to around Rs 46,500-47,000 in the first week of June. At the time of writing this report, the most-active June delivery steel contracts on the NCDEX were trading at exactly Rs 47,000. What triggered this sharp decline in its prices in the Indian market?

The government recently waived customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry. Also, some experts say that the ongoing cool down of prices has something to do with the weak demand for the commodity during the monsoon season as some infrastructural activities typically slow down with the onset of summer season.