September 08, 2008

Only new capacities can contain steel prices – Mr Muthuraman

Mr B Muthuraman MD of TATA Steel said that the only way to contain steel prices is to create new steel capacities in India.

Mr Muthuraman said that while prices of everything, from raw materials to energy inputs and ocean freight had been rising, demand driven growth for steel from developing economies coupled with inadequate raw material availability was seeing steel products touch unprecedented highs.

Mr Muthuraman said that "In a scenario like this, apart from exercising self restraint on steel prices amidst rising input costs, which SAIL and TATA Steel were practicing, albeit with self imposed difficulties, the only way to contain steel prices was to create new steel capacities in India matching or even exceeding the fast pace of demand growth unleashed by our liberalized economy."

Mentioning the domestic steel industry was growing by 10% to 15% year on year, Muthuraman said that "We need to increase the speed with which new steel capacities are getting created in India."

He also alleged that a couple of countries along with 4 to 5 companies were dictating terms to the industry globally.