The steep hike in steel prices has hit the Hyderabad construction industry which is already struggling with the problems following cement and land becoming more expensive. Buyers may stay with flats and houses becoming more expensive, the industry fears. The state-owned Steel Authority of India, Tata Steel, Essar Steel and Ispat Industries on Friday hiked steel prices up to Rs 2,500 per tonne. Cold-rolled steel, which is mainly used by the construction industry, now costs Rs 38,000 a tonne. Two months ago, it was available at Rs 30,000 per tonne.
Steel companies blamed the hike on the higher cost of raw materials such as coal, coke and iron ore. These have gone up nearly 22 per cent and could rise further. According to Real estate construction companies, steel accounts for 10 per cent of the total expenditure and cement, seven per cent. A 50-kg bag of cement now costs about Rs 220. The AP Builders Forum expressed serious concern over the price hike and asked the government to take steps to reduce rates. "Monopoly of some companies will lead to collapse of construction activity. Buyers will not come forward if the cost of flats and individual houses increase," said Mr Yoganand, general secretary of AP Builders' Forum.
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