If the recent strength in prices of steel sustain, steel spreads are likely to improve in the December quarter, Axis Securities said in a note.The cost of coking coal, which is used in the production of steel, is down by $45-$60 per tonne from the previous quarter.This is in contrast to the production volumes of other leading steel makers.The profitability of most domestic steel makers is set to improve by ₹500-₹2,000/tonne quarter-on-quarter in the three months to September, largely aided by lower cost of a key raw material, according to analysts, even as steel prices fell in the seasonally weak period.The improvement in profitability that steel producers see, though, will be capped because of steel prices moving 3-5% lower during the quarter, with prices of long steel products seeing an even sharper decline of up to 8%, according to analysts.
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