Where are steel prices headed?
Steel prices are quite stable and they are still increasing, but that is primarily because of the cost pressures that we have. There has been tremendous cost pressure in the steel industry. Iron ore is up three times. I think they are driving us to increase their prices. The mining industry clearly has its own demand-supply issues. There is a constraint on the global world and they are consolidating. Why is oil at USD 135 per barrel? Why are steel, ore and coal prices going up? The answer has to do with rapid industrialization. Since World War II we have had a couple of hundred people industrializing every decade. You had the US first and then Europe, Japan, Korea et cetera. Today we have over 2 billion industrializations, some in India, China, Brazil, Russia, which is creating a tremendous strain on resources and commodities like steel, oil, iron ore, coal are in tremendous demand. I think there is a price escalation as a result. The majority of cost for the steel industry is raw mate
