Steel prices may see a decline in the next few months following the re-opening of a number of steel plants in the US.

The re-opening of some of the plants in the US has also resulted in surplus availability of steel in the country which in turn may affect global steel prices. Besides, this has already led to a surge in US steel exports to China and East Asian countries.

Though the surge in exports have not yet impacted the Indian steel market, domestic steel producers are worried that their export pie to China may be in danger. "With US increasing its exports to China and other countries, India's export business may be hampered," an industry expert said. China is one of the key export markets for India.

About one million tonne of steel have been exported to China and East Asian countries from the US in the last few months.

The Organisation for Economic Co-operation and Development members, in a meeting recently, have pointed out that the US act has violated the OECD ruling.

In December 2002, the OECD members, that met in Paris, had decided against any addition to the existing global steel capacity. Besides the member countries had also agreed to shut all non-viable steel units to maintain the global demand-supply balance in the sector.

Industry experts said that the addition to the existing steel capacity may once again may affect global demand supply ratio thereby resulting in a drop in prices.

Meanwhile the European Union emphasised that once financial assistance for closure is extended to a plant, it should be ensured that the plant in question is not allowed to re-open.