What are the Factors That Affect the Price of Your TMT bars?
Steelmaking is a lucrative industry in our country in today’s day and age. However, it is also a costly business. The only survival mantra for the steel industry is to cut cost in production. It often becomes easy for steel companies like MS Life to cut their production costs by an effective forecast of the market behaviour. The steel industry of India contributes approximately 2% to the country’s annual GDP, creating job opportunities for over 25 lakh people both directly and indirectly
Production of steel is dependent on many variables like iron ore, coking coal, limestone, natural gas and power, and many more. Manufactured steel is subjected to multiple numbers of events that can influence the prices like any other commodity.
Here are some of the factors that affect the pricing of TMT bars in the steel industry-
The Supply and Demand of Steel
Like every other commodity or service in any economy, the primary factor that affects the price of steel is its demand and supply rates. Prices of steel are categorized based on a prior forecast of the market, with supply and demand as its parameters. In-depth research of the market trends can help business mark their prices accordingly.
Availability and Cost of Raw Materials
Some of the raw materials that go behind the production of TMT bars are iron ore, coal, dolomite, limestone, and many more. The availability of these raw materials affects their prices, and in turn, also affect the prices of TMT bars. Unavailability of these resources results in demand exceeding the supply, thereby rising prices of steel bars. Another major raw material for steel making is energy, as steel needs a lot of heat to melt.
Transportation and Distribution Costs
Every well-produced commodity needs to be shipped to distributors and sellers to complete the manufacturing process.Selecting a freight method which includes a longer transit time can have huge impacts for any steel making company and cut their costs drastically. Overseas or regional shipping costs play a major role in the prices of steel. Government regulations, logistic and political climate also plays a major role in determining the steel prices of any country.
Cost of Energy and Power
One of the most important factors affecting the price of steel is oil and electricity. While some major brands have resorted to solar-powered factories to reduce their cost of production in the long run, other companies still use oil and electricity to power their machines. Oil prices are determined through global markets, and it plays a huge role in the price of steel. Upon researching, you will find out that the prices of steel and oil fluctuate hand in hand.
The prices of steel affect construction, automobile, electrical appliances, machine, etc. industries. It takes an in-depth analysis of all these factors along with many more factors to rightfully forecast the market trends and setting prices. Compared to other TMT bars price in Hyderabad and other cities in southern India, MS Life is more economical and better in quality.