Industrial establishment ISA has requested urgent government intervention to control the price of coking coal, which has tripled to about USD 450 per tonne.
"Coking coal prices are something that greatly impacts the industry and affects the cost of production, affecting steel prices," said Alok Sahay, Secretary General of the Indian Steel Association, in a meeting with PTI. said.
The Indian Steel Association (ISA) represents the local steel industry.
Explaining the situation, Sahay said that about a year ago, the price of coking coal was in the range of 120-130 USD per ton.
He added that in March 2022, coking coal prices peaked at around USD 670 per tonne.
The industry expert said the cost of coking coal alone in steel production in the current price range is around Rs 28,000 to Rs 30,000 per tonne, which is around 40-45% of the production cost. There are also other input materials such as iron ore, ferroalloys, logistics, fuel costs and other fixed costs.
Sahay also noted that when crude oil prices increase, gasoline and diesel prices also increase, which affects the entire supply chain. Similarly, steel prices are rising in line with increasing coking coal rates.
However, the ISA is instructing the government to take note of coking coal prices since February 2022, as it is of the view that "the price must be controlled so that the cost of steel production can be reduced".
Coke and iron ore are the two main raw materials used in steelmaking.
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