Domestic Steel Production.

Capacity expansion projects are still on track. Although some projects have been delayed, there have been no announcements of cancellation of major projects. For example, Korea’s POSCO has delayed its 12 million tonne per year steel mill but there is neither cancellation nor scaling down of its plan. JSW Steel will continue its expansion plan with a new 3 million tonne blast furnace which will make it the largest blast furnace operator in India.

Steel producers in India are, however, not immune to the global economic downturn and have instituted production cuts. According to the World Steel Association, crude steel production in India registered a slowdown in the Q4 of 2008 with a growth rate of 0.3% and dropped significantly in the first two months of 2009 to 8.67 million tonne, a decline of 8%YoY.

However, due to a rising demand in the country, steel producers are expected to return to normal operations very soon. Industry analysts pointed out that inventory levels of steel firms increased in October to November 2008 as demand has weakened.

Nonetheless, there are indicators that inventory levels have dipped recently. Thus, steel production is expected to return to normal levels in the Q1 of the fiscal year 2009.

Source: http://steelguru.com/news/index/2009/05/14/OTQyNTc%3D/Brief_on_India_steel_industry_and_outlook_-_SEASI.html

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