Steel exports surge 142%, imports down 23% in April

indexSource : Business Standard 15 May 2017

Overtaking imports, India’s steel exports jumped by 142 per cent in April to 0.747 million tonnes (mt) as compared to 0.308 mt in the same month last year, said a Steel Ministry report.

Steel imports were down by 23 per cent to 0.504 mt in the last month from 0.654 mt imported in the corresponding month of the last financial year (FY).

“Export of total finished steel was up by 142 per cent in April 2017 to 0.747 mt over April 2016 and declined by 54 per cent over March 2017. Import of total finished steel at 0.504 mt in April declined by 23 per cent over April 2016 and also declined by 16 per cent over March 2017. India was a net exporter of total finished steel in April 2017,” said the report of Joint Plant Committee.

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Sale of steel grows 50 per cent in December 2009

In an indication that economic recovery is building steam, Indian steelmakers such as Steel Authority of India (SAIL), JSW and Ispat posted strong returns for the month December 2009. SAIL announced that it had posted at 1.3 million-tonne sales in December 2009, a 32 per cent increase over the previous year. SAIL’s third quarter sales ending December 2009, grew 23 per cent over the previous year on the back of increased consumption by the construction industry.

In comparison with the global demand for steel estimated at 9.2 per cent in 2010, usage of steel in India for the year is estimated to rise by 12 per cent. Seshagiri Rao, JSW Steel Joint Managing Director said, “The last two weeks of December 2009 saw a significant turnaround in demand.” In the domestic market, steel products are currently selling for US$ 687.81-US$ 730.8/tone.

Mumbai-based steelmaker Ispat Industries’ sales received a fillip on the back of strong demand from he automobile sector. Ispat Industries finance director Anil Surekha said, “We are not carrying November’s inventory and sold whatever was produced, as demand is strong.”

Source : IBEF. 04/01/10


SAIL may cut prices of flat steel products

NEW DELHI: India’s largest steel maker Steel Authority of India (SAIL) may cut prices of flat steel products sold in the spot market by Rs 500/tonne next month in line with international price movement, a top company executive said on Tuesday. Flat steel products are largely used by automobile and consumer durable sectors.

“A small correction of Rs 400-500 per tonne may happen in the flat steel products category. However, prices of long steel products, used mainly for construction, have bottomed out and will stabilise at the current level,” SAIL chairman SK Roongta said on the sidelines of the Indian Economic Summit.

Early this month, steel producers, including SAIL, JSW and Essar, reduced prices of flat steel products by up to Rs 1,500/tonne as prices in some of the international markets had fallen to $450/tonne level. Currently, basic flat products are selling between Rs 32,000 and 34,000/tonne in the domestic market.

SAIL continues to see steel demand growing in India, led by infrastructure and automobile sectors, even as demand has slumped in China and other global markets. On the back of increased domestic demand, it is eyeing average 8-10% growth in sales volume for the year ending March 2010 over last year. The steelmaker produces around 13 million tonne of metal annually.

Source : Economic  Times.  11/11/09

Steel firms may incur loss in next two quarters: Muthuraman

A majority of the steel companies in the world, which recorded huge losses in the first quarter, were likely to face a similar situation in the next two quarters due to the unprecedented global meltdown, Tata Steel managing director B Muthuraman said today. “Only a year ago, we were all talking of a robust economy and growth but the scenario looked different within a year’s time”, Muthuraman said while unfurling the National Tricolour here on the occasion of the 63rd Independence Day.

The economic recession, he said, had resulted in a lack of liquidity in market, leading to a lack of consumer credit and working capital the world over, he said.

The meltdown had a serious impact in all sectors of industries, including the steel sector. There was a sharp drop in the demand for steel and a sharper drop still in its prices, Muthuraman said.

However, India alongwith China were fortunate that the impact of the prevailing recession was not much compared to other parts of the world, Muthuraman said.

The global meltdown witnessed since October 2008 had not been witnessed since the Great Recession of 1930, he said. Inspite of a sharp drop in demand and prices of steel, India and China have shown positive growth in its demand, Muthuraman said.

While the demand in steel witnessed 50 per cent slump, Japan and Korea registered 20 per cent drop even as the prices of steel was halved compared to the last year all across the globe.

Muthuraman predicted that the steel sector was likely to witness an overall drop of 20 per cent in demand in the year 2009. As the private steel major has its operations not only in India but Europe and South East Asia, he said the company has initiated efforts to face the challenges of the meltdown strongly and become one of the best company in the world.

Appreciating the spirit of its employees to weed out the challenges, Muthuraman stressed the need for cost control and said the company was restructuring its operation in Europe.

Later, talking to newsmen, Muthuraman admitted that the prevailing drought-like situation could affect the economic growth of the country but appreciated the measures initiated by the Union government to tackle the 1situation.

Source : Business  Standard  21/08/09


After SAIL, pvt steel cos’ sales soar

New Delhi: Top private steelmakers witnessed robust sales growth in April 2009 compared with the same month last year on the back of healthy demand from construction and automotive sectors. Tata Steel and Essar witnessed up to 30% jump while JSW Steel’s sales more than doubled during the month. Together, the three firms account for about one fifth of the country’s total steel production capacity. Earlier this week, public sector steel maker SAIL, the largest steel producer in the country, reported 68% increase in sales of long steel products that is used in construction.Tata Steel sold 4.52 lakh tonne steel last month, a 31% growth over the same period last year. Sales of long products moved up 39% and flat steel sales rose 27% during the month. Flat steel is mainly used by automotive and consumer durable sectors.

“Demand for steel from construction and infrastructure sectors rose steeply last month, which is visible from high growth in sales of long products. Automotive sector has also started showing signs of revival,” said a Tata Steel spokesman.

JSW Steel’s sales more than doubled to four lakh tonne in April 2009 vis-à-vis April last year led mainly on demand from infrastructure sector in semi-urban and urban areas. “We commissioned a new production line next to our steel plant in Vijayanagar this year, which helped us in meeting the increased demand. This is reflecting in high sales figure for April,” said JSW Steel director (finance) Seshagiri Rao.

Essar Steel, which produces only flat steel products sold 2.5 lakh tonne of steel last month, 15% more than April 2008. Says Essar Steel ED Vikram Amin, “Passenger cars segment has witnessed growth over the last few months, which has pushed up the sales of flat steel products.”

Source : The Economic Times 08/05/09


India may steel show in global road to recovery

Chances of the Indian economy recovering faster than its global peers from the current slowdown looked brighter with the World Steel Association (worldsteel) forecasting a 2% growth in the country’s steel consumption in 2009, making it the only major economy to post an increase in a year that will see global consumption of the metal fall by around 15%.

India, which accounts for around 5% of the global steel consumption, will use 53.5 million tonnes of the metal in 2009. The global consumption of steel this year is expected to be around 1,019 million tonnes.

Worldsteel, an international trade body whose 180 members account for 85% of the world’s steel output, has said the global steel industry will stabilise later this year to stage a gradual recovery in 2010. Egypt and Iran are the only other countries that will witness an increase in steel demand this year.

Steel consumption in the BRIC countries (Brazil, Russia, India and China) is expected to fall by 5.9% in 2009. The ‘short-term steel outlook’ of the Brussels-based association said steel demand in the US and Europe would shrink by 36.6% and 25%, respectively. Steel use in China and Japan are slated to fall by 5% and 20.4%, respectively.

While worldsteel did not cite any reason for the growth in steel consumption in India, analysts said this could be attributed to the low per capita steel consumption at present. The country’s per capital steel consumption is about 45 kg, compared with the global average of 200 kg.

“Considering a GDP growth forecast of 5-6%, spending on various construction and infrastructure projects will grow this year, which will reflect in an increased steel consumption. Since investments have come to a standstill in most economies, steel consumption is likely to get impacted globally,” said Abheek Barua, chief economist, HDFC Bank.

Growth in the construction and infrastructure sectors could help India record a 5% growth in steel consumption, said Naveen Vohra, partner, Ernst & Young. “Demand in the auto sector has also started looking up on the back of a marginal improvement in the credit situation,” he said.

Despite low levels of steel consumption in the country, demand had fallen sharply during October-December 2008. The steel industry, however, staged a smart recovery in the first three months of 2009 on account of a revival in demand from the automobile, rural infrastructure and housing sectors.

Steel production and consumption grew 1.2% and 3.8%, respectively, in the January-March quarter over the same period last year, after posting dismal figures in the previous quarter.

Source: The Economic Times 29/04/09


Steel industry to take joint venture route to growth

The Indian steel industry, cautious in the current economic scenario, will prefer joint ventures (JVs) to big ticket merger and acquisition (M&A) deals when getting into a tie up with partners overseas, say experts.

JVs with overseas companies have been a norm but do take three to four years to be on firm ground. Kolkata-based Visa Steel in August 2007 entered into a JV with Baosteel of China to set up a 100,000 tonne per annum ferrochrome plant in Orissa. Similarly, Sumitomo Metal Industries, Japan’s third largest steel maker, is reportedly looking at a venture with India’s Bhushan Steel to set up a $1.8 billion steel factory in West Bengal.

NYSE listed non-ferrous metals giant Vedanta Resources is planning to enter the Indian steel sector with a 5 million tonne plant and an investment of about Rs24,000 crore in Keonjhar district of Orissa and is scouting for partners.

Validating this strategy, Manish Makharia, executive director, Kotak Investment Banking says, “Global giants like Arcelor Mittal and Posco would prefer setting up a greenfield plant in India, whereas others may prefer entering India in the form of joint ventures.”

Raw material needed by steel plants is available in India and is a fact that will lure companies.

“India will be an attractive JV destination for Japanese companies as the Japanese players have technology and huge cash with them, but no raw material security which is available here,” said an analyst tracking the industry.

Additionally analyst reports say, India remains better placed on the demand side than other countries. The steel industry here is operating at 90% capacity whereas in Europe they are operating at 65 to 70% capacity and 55 to 60% in the US and in China they are operating at 75% capacity.

Source: Business Standard 28/04/09


Steel gets anti-dumping duty to beat import heat

The government has imposed a special anti-dumping duty on import of cold-rolled flat stainless steel products, shielding some domestic producers from the threat of cheaper imports, while pushing up costs for several consumers.

The levy, called the provisional special duty and ranging from $12.74 per metric tonne to $2011 per metric tonne (depending on the type of steel, country of manufacture, origin of import and producer) will make imports from the US, European Union, China, Thailand, Korea, South Africa, Chinese Taipei and Japan dearer. While the levy will help stainless steelmakers Jindal Stainless and SAIL, a raft of users straddling sectors as diverse as automobiles to refineries to utensils and kitchen equipment makers will be hit by costlier imports.

The anti-dumping duty will remain in force till October 21 this year, but could be reviewed and extended further. The duty will hit companies such as ArcelorMittal, Acrinox, Outokumpu, Columbus, Posco, Daewoo International Corporation, Hyundai Corporation and LG International, which sell stainless steel manufactured abroad in the Indian market.

The Central Board of Excise and Customs, an apex body for indirect taxes that typically levies such duties upon receiving evidence of dumping, has notified the duty. Dumping normally involves exports of a product or a commodity from a country at a price lower than what it is sold locally and which causes injury to local producers of the importing country. The notification follows a recommendation by the Directorate General of Anti-dumping and Allied Duties (DGAD), which said the domestic industry had suffered “material injury” as a result of dumping.

“As the largest producer of stainless steel in the country, the dumping of stainless steel affected us the most…We hope the measure will improve the capacity utilisation of domestic companies and improve availability of steel in the market,” Jindal Stainless director NC Mathur said.

However, users of high grade stainless steel represented by All India Stainless Steel Industries Association, Pesticides Manufacturers and Formulators Association of India and Process Plant and Machinery Association of India have demanded the rollback of the duty saying it would impact their operations.

The anti-dumping investigations started last November following a petition by Jindal Stainless. Stainless steel imports rose to 16,000 tonne that month, up 60% year-on-year. During the financial year to end-March 2009, import of alloy steel, which include alloy steel, rose to 5.75 lakh tonne from 4.48 lakh tonne in the previous fiscal year.

Source:  The Economic Times 24/04/09


Indian steel companies are likely to increase prices

Indian steel companies are likely to increase prices by 500 rupees ($9.8) to 700 rupees a ton this month-end on expectations of improving demand from the automobile and construction sectors, industry officials said.

Benchmark hot-rolled coil prices range between 33,770 ruppes to 35,182 rupees/metric ton in the local market.

Industry officials said steel prices have stabilized and there is room for “moderate price increases” of about 500 rupees to 700 rupees/ton, an industry official who declined to be identified said Thursday.

“I think there is a stabilization of steel prices,” said J. Mehra, chief executive officer of Essar Steel Holdings Ltd. “There is no pressure on prices as of now….We will have to watch whether the demand is rising.”

Most auto makers in India reported sales growth in February and March, signaling a recovery in that sector and a potential rise in demand for steel.

“There is a revival in the auto sector, which is one big change; besides, cement sales have improved, which shows construction is picking up,” Director M.V.S. Seshagiri Rao of JSW Steel Ltd. said.

Value-added steel maker Uttam Galva Steels Ltd. plans to raise galvanized steel product prices by 500 rupees to 1,000 rupees/ton but has yet to decide on the size and timing of any increase, Ankit Miglani, director of the company told Dow Jones Newswires Wednesday.

Indian steel companies had cut steel prices by about 700 rupees/ton in February, passing on the benefit of tax cuts by the federal government.

Local steel prices are likely to remain firm in April due to some recovery in demand, said Pawan Burde, senior analyst with Mumbai-based Angel Broking.

Steel companies such as state-run Steel Authority of India and Tata Steel Ltd reported a sharp fall in net profit in the quarter ended December 2008, the first decline in three years. The industry expects to report better results in the quarter to March 2009.

“In India, demand is still the bright spot as we have seen good demand for billets, bars and angles,” JSW Steel’s Mr. Rao said, adding global steel demand is showing signs of recovery as evident in scrap and billet prices.

While industry officials said steel prices have stabilized, analysts said prices may weaken once the coking coal and iron ore contracts for this financial year, which started Wednesday, are fixed.

Indian steel prices could fall by 1,000 rupees to 1,200 rupees/ton by May-June once the raw material contracts are settled,” Angel’s Pawan Burde said.

Source: The Wall Street Journal  02/04/09


Arcelor-Mittal plans captive port in Orissa

The port will be used to export finished products from the company’s proposed mega steel plants. Arcelor-Mittal, the largest steelmaker of the world, plans to set up a captive port at Barunei Muhan, located to the north of Mahanadi river near Paradip in Orissa.

The port will be used to import raw materials like coking coal and limestone, and export finished products of the company’s proposed integrated mega steel plants in Orissa and Jharkhand. The steel projects will have capacities of 12 million tonnes each.

The captive port is projected to have a cargo handling capacity of 35 million tonnes per annum (MTPA), to be attained in two phases. However, the company has not indicated the quantum of investment for the port.

A team of company officials led by Sanak Mishra, chief executive officer (CEO) of Arcelor-Mittal’s India greenfield projects, today made a presentation on the port project before Orissa chief secretary Ajit Kumar Tripathy and other senior officials of the state government.

The proposed port will have a cargo handling capacity of 10.62 million tonnes in Stage-I of the first phase, which will be expanded to 17.3 million tonnes in Stage-II. After the completion of the second phase, the cargo handling capacity will go up to 35 million tonnes.

The port will handle cargo like coking coal, PCI coal, limestone, slabs, billets, HR coil and steel products. It will have five berths in the first phase and seven berths by the end of the second phase. While 391 vessels are expected to visit the port every year by the end of the first phase, the number will grow to 582 ships when it is fully commissioned.

In its presentation, the company stated that it would be prudent to design the first phase with Panamax-size vessels in mind, which could be upgraded to handling cape-size vessels in the second phase. The channel will have a depth of 16 metres and a length of about 6 km. This will further increase to 20 metres and 10 km by the end of the second phase.

The company proposes to construct a double-lane rail line to connect the port with the Paradeep-Haridaspur main line. Similarly, new sidings will be constructed for railway connectivity. Besides, a four-lane road will be constructed to connect the port with the National Highway No 5.

The captive port will have steel servicing centre, downstream processing and finishing line, ancillaries such as automotive industry, technical training institutes and fabrication workshops. The company has indicated that about 6,000 acres of land will be required for setting up the project and related infrastructure, sources added.

Interestingly, the port site will be about 270 km away from the site of the company’s 12 million tonne greenfield steel project in Patna tehsil of Keonjhar district.

The preliminary project report was prepared by the Department of Ocean Engineering, Indian Institute of Technology, Chennai.

However, the fate of this proposal remains uncertain as the state government is not in favour of captive ports coming up at the identified locations because it fears they would result in underutilisation of the port potential of the state.

Source: Business Standard 09/04/09