MUMBAI (Commodity Online): India Steel Long futures opened the trade slightly on the lower side on Monday, but the market has managed to climb back up above the previous closing price. In addition to the strong charts the tightness in Iron ore market has a hand in the punting up steel prices. In the domestic market of Orissa, iron ore lumps cost Rs. 300 per tonne more than earlier.
Steel prices are, however, being downgraded in the international market. The market might turn its attention towards the move by Baosteel, the largest steel producer of China, in which they have reduced prices for all their major products, reflecting weak demand for the alloy. According to a report from Reuters, Baosteel cut prices for all its major products by CNY 100 to CNY 200. The report said that prices of hot rolled products will be cut by CNY 200 and cold rolled products by CNY 100.
Baosteel has such influence in the market that other steel makers in the country are expected to follow the example. The seasonal lull in steel market during the second quarter is also expected to cap gains in the market.
The market is expected to pick up towards Rs.32300 in the short term backed by strong technicals, said analysts. However, a consolidation could ensue before the market resumes its upward trajectory, added analysts. Steel futures at National Commodity and Derivatives Exchange of India (NCDEX) July contract opened the trade on Monday slightly lower, but recouped enough strength to climb back up. The market traded at Rs.31080 per tonne at 11.15 AM IST, up 40 rupees.
