Cost Structure of Hot Rolled Industry Free Essay Example, 3000 words

According to the research findings, it can, therefore, be said that hot roll steel prices have no official controls or policies and they are to be determined by the market. However, there appear to be market flaws and likely cartelization which has given the manufacturers of HR Coils with the larger degree of market authority over the consumers. The users of HR coils, primarily the mills manufacturing cold roll or galvanized sheets or pipes have highlighted to oligopoly pricing performance of the hot roll producing firms. Their main disagreement, as declared by them, is the following: The HR coils manufacturers have intentionally minimized supplies to the local market by selling out abroad considerably high amounts of the product, regardless of the reality that the whole quantity could be consumed in the local market at the cost they are exporting or even at elevated prices. It quarrels that there was a point when the local HR Coils industry was experienced with surplus capacity com ing from a rupture of capacity addition and the simultaneous slowdown in local steel requirement. This was the period when the exports were essential. We will write a custom essay sample on Cost Structure of Hot Rolled Industry or any topic specifically for you Only $17.96 $11.86/page According to the user firms, the HR coils manufacturers place prices in unison in infringement of the standard of a competitive market. The price augmentation had no orientation to any explicit modification in the market neither in the demand nor supply side of it. They have also established the worth augments as random having no association with their expenses or any modification in them.