SAIL Sees Continued Steel Price Drop

16 Aug 2024 , 12:19 PM

According to a top executive who talked to ET, Steel Authority of India anticipates that its blended realizations will decline by an additional Rs 1,000 per tonne this quarter as low-cost Chinese imports continue to pressure local steel prices.

For the June quarter, net sales realization, or blended steel prices, were Rs 53,700 per tonne, which was Rs 800 less than the prices for the March quarter.

Although coking coal prices have dropped in recent weeks, they are still expected to stay around the same as they were in the June quarter. Anil Kumar Tulsiani, Director (Finance), said analysts following the company’s earnings that this is because the state-owned steelmaker has stored up on higher-than-average coking coal from some of its miners with whom it has long-term agreements.

According to him, the combined cost of coking coal was Rs 22,000 per tonne in the June quarter and is probably going to stay at current levels. The majority of other steel producers have provided guidance for reduced coking coal costs in the September quarter, in keeping with worldwide prices.

Over the coming months, the company expects its coal stockpile to trend lower, which will also help it free up some working capital. According to the corporation, increased coking coal inventories and steel inventories totaling Rs 1,000 crore contributed to a quarter-over-quarter increase in debt of more than Rs 5,000 crore.

The company disclosed that its inventory of steel was 1.84 million tons during the quarter.

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