India: UP Govt Hikes Power Tariff; Steel Making Cost to Increase

Input cost burden for steel mills is to grow further in Uttar Pradesh after recent announcement of power tariff hike, SteelMint learned from mid sized mills based in Ghaziabad & Muzzafarnagar, known as the major producers of steel in the state.

The prevailing power charges in U.P for industrial consumption was near to INR 6.30-6.40/MT which will be increased to INR 6.80-6.90/MT, hiked upto 10% for mid sized steel mills.

The tentative cost of Ingot/Billet producers in the state will rise by INR 400-500/MT and for standalone re-rollers marginally by INR 100-200/MT.

As per assessment on 3rd Sept'19, in Ghaziabad the prices were reported at INR 28,300-28,500/MT for MS Ingot, INR 31,500-31,700/MT for 12mm Rebar & INR 22,500/MT for selected (melting) scrap, ex-works & excluding 18% GST.

On an average, the standalone mills (including hot rolling mills) in U.P (Kanpur, Ghaziabad & Muzzafarnagar) produces about 5,000-7,000 MT rebars on daily basis and supply mostly in NCR region including local market. There are about 30 operational steel mills in U.P, as reported by manufacturers.