State-run Steel Authority of India Ltd expects steel prices to go up next month following a rise in global prices, its chairman said on Thursday.
“International prices have gone up so it’s likely that domestic prices will also go up next month,” SK Roongta told reporters at an industry conference.
SAIL, India’s top maker of the alloy, is likely to produce 13 million tonnes of crude steel in the current fiscal ending March 2010, Roongta said.
SOURCE:http://www.moneycontrol.com
Financial problems across the region are expected to negatively affect demand over the coming months. This, coupled with weak export markets, will push transaction values for all flat products lower in the short term. De-stocking by distributors is forecast to continue during the final quarter. Consequently, mill sales volumes are likely to drop further. This may prompt local producers to further reduce selling offers in a bid to fill their depleted order books. The auto and construction industries are reported to be particularly weak, impacting heavily on cold rolled and coated figures.
Productions cuts by some mills in the region could help to stabilise the market by the end of 2008. A modest price revival is anticipated by the second quarter of 2009 as inventory rebuilding commences. However, low growth rates, predicted across many sectors next year, will limit advances in selling figures and could lead to reductions in the final few months of 2009.
Significant decreases in scrap and billet costs are predicted to lead to further declines in steel transaction values across all the long categories. Inventory levels are rising due to weakening demand. With fewer new projects anticipated over the coming months, consumption could continue to fall. This will prompt many customers to restrict purchases in the short term. Domestic mills are already cutting production in an effort to stem the downward price movement. However, this is unlikely to be enough to stop selling figures from drifting lower in the fourth quarter of 2008.
The current price cycle is forecast to reach the bottom early in 2009. Stability in scrap values is expected to return by this point, with possible rises in the first quarter. Distributors are likely to reassess their inventory levels, with a pick-up in buying anticipated after the Chinese New Year. Consequently, long products selling figures should move upwards towards the end of the first trimester. However, due to an uncertain global economy, a relatively modest upturn is anticipated.
SOURCE: http://www.steelonthenet.com/feeds/indian_steel.php
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By Debarati Roy and Abhishek Shanker
Dec. 10 (Bloomberg) — India’s steel production may fall short of the government target as mills planned by companies including ArcelorMittal, Posco and Tata Steel Ltd. face delays, Steel Minister Virbhadra Singh said.
The ministry will probably have to lower this year’s forecast to reach 124 million metric tons of output by March 2012, Singh said in an interview in New Delhi. Difficulties in acquiring land and iron-ore mines have stalled almost $80 billion of steel projects that would have more than doubled the nation’s 55 million-ton production, he said.
“We may have to revise our estimates if we can’t solve many of the problems of the greenfield projects,” Singh said yesterday. “I’ll be happy if we do 120 million tons or so.”
Steelmakers, aiming to set up 160 million tons of capacity in the eastern states of Chhattisgarh, Jharkhand and Orissa that together hold more than half of India’s iron-ore reserves, have failed to win mining licenses from the state governments and acquire land from protesting farmers. Prime Minister Manmohan Singh’s government aims to resolve land disputes and delays in allocating mining licenses to help achieve as much as 9 percent annual economic growth.
India’s economy in the three months to Sept. 30 expanded at the fastest pace in 1 1/2 years as manufacturing jumped. Gross domestic product grew 7.9 percent in the quarter after gaining 6.1 percent in the previous three months, the statistics bureau said on Nov. 30.
Karnataka Talks
South Korea’s Posco in June 2005 said it planned to set up a $12 billion steel plant in Orissa to tap demand in India. ArcelorMittal, the world’s largest mill, announced a plan to set up a $10 billion mill in the neighboring state of Jharkhand the same year and said in 2006 it would build a similar-sized unit in Orissa. The companies said last month they have initiated talks with Karnataka to build factories in the southern state.
Tata Steel, India’s biggest producer, announced a 6 million-ton plant in Orissa in 2004 and a similar-sized plant in Chhattisgarh the next year. In 2005, Tata also announced a 12 million-ton plant in Jharkhand state. JSW Steel Ltd has announced three 12 million-ton plants in each of the states of West Bengal, Orissa and Jharkhand.
The delays come at a time when demand for steel in India, the world’s second-fastest growing major economy, is recovering faster than in overseas markets, buoyed by sales of automobiles and government spending on roads, ports, telephone and electricity networks. Supply may lag behind demand, which may rise an average 7 percent this fiscal year and is expected to increase 10 percent by March next year, Virbhadra Singh said.
India’s steel demand gained 7 percent in the first seven months of the fiscal year up to October, Steel Secretary Atul Chaturvedi said on Nov. 14, without giving specific numbers. Consumption rose to 26.49 million tons in the six months ended Sept. 30 from a year earlier, former Steel Secretary Pramod Rastogi said in October. Output rose 2 percent to 28.49 million tons, he said.
“I sympathize with the companies building greenfield projects,” steel minister Singh said. “It’s a time-consuming process.”
To contact the reporters on this story: Debarati Roy in Mumbai at droy5@bloomberg.net; Abhishek Shanker in New Delhi at ashanker1@bloomberg.net
Source: http://www.bloomberg.com/apps/news?pid=20601091&sid=adeNi3vEqes8