India's steel imports jump 50 per cent in April-September news...

India's steel imports jump 50 per cent in April-September news

04 October 2008

Mumbai: Steel imports into the country has shot up 50 per cent to about 3 million tonnes during the first six months of the current financial year (2008-09), as compared to the corresponding period in the last fiscal, Steel Secretary Pawan Kumar Rastogi has said.

Addressing a meeting of steel consumers in the capital, minister for steel Ram Vilas Paswan also said India was expected to continue to be a net importer of steel in the current fiscal following the huge demand supply mismatch.

''Whereas the demand for steel continues to be at around 11.2 per cent, the production growth in the first half of the year has been only 5.2 per cent,'' Rastogi said.

Steel imports into the country totaled 6 million tonnes in 2007-08 amidst a growing demand for alloy steels, he said.

Growth of steel consumption in the country is outstripping production, and even at full capacity production, the country will still be importing an increasing quantity of steel, he said.

India's current steel production of 58.64 million tonnes is expected to rise 6 per cent in fiscal 2008-09 while demand will grow at around 12 per cent.

The country's steel demand is expected to reach 109 million tonnes by 2012-13 and the government has envisaged a total production of 124 million tonnes, excluding the proposed greenfield projects of Posco and ArcelorMittal, he said.

''We should be able to achieve the production target. SAIL has placed work orders worth Rs30,000 crore for its proposed augmentation of capacity to 26 million tonnes,'' he said.

While global demand for steel has gone down, India's steel consumption and demand is expected to grow as its infrastructure sector is booming, he said, adding that global steel prices have softened by about $350 a tonne.

Rastogi, however, said the amount of steel imports for the whole of fiscal 2009 would depend on prices and demand.

He also pointed to a likelihood of demand coming down as the real estate sector slows amidst high interest rates and a slowing economy.

Major steel companies like South Korea's Posco and Arcelor Mittal are planning to set up steel plants in India attracted by the ample reserves of iron ore. State-run Steel Authority of India Ltd and National Mineral Development Corp are also investing in steel mills.

Four Chinese steel firms - Shougang Steel, Angang Steel, Shandong Iron and Steel and Hebei Iron and Steel - on the other hand, are planning production cutbacks of up to 20 per cent or up to 20 million tonnes, in a bid to cut iron ore imports and support prices, the official Xinhua agency said. The four have a combined capacity of 100 million tonnes of crude steel.