BUSINESS
And India knows that it, along with China, will decide the fate of global steel markets in the future. On the other hand there is great uncertainty.
There’s a whirlwind of confusion within the Indian steel industry. On the one hand, there is euphoria — demand for iron and steel continues to soar.
And India knows that it, along with China, will decide the fate of global steel markets in the future. On the other hand there is great uncertainty.
Nobody is sure about what the prices of steel or the raw materials that go into the making of steel will be like over the next few years.
Demand for steel is good news, but uncertainty about the price at which it can be sold can spell trouble.
First look at the causes leading to the euphoria.
The financial meltdown took the wind out of most developed markets. For two years successively, their production has dropped.
And it is not certain if 2010 will allow them to reach the production levels they had achieved in 2007.
India did see a marginal dip in production in 2009, but it was just marginal. It bounced back in 2009, producing 56 million tonnes, and is likely to see production levels soar further this year.
India’s consumption growth continues to climb unabated. “Look at the way India’s imports continue to surge ahead, while exports have begun to slow down,” sais Ashok V Bharadwaj, director, Ispat Industries, at a MetalBulletin Steel conference in Mumbai last month.
This view is echoed by T S Sunderasan, secretary general of the Ferro Alloys Producers’ Association. “India’s economy has been growing at 8-9%. In January this year, the Index of Industrial Production (IIP) rose by 17.9% compared with the level in January 2009 .The growth rate for durables stands at 22% and automobile production at 17%. But most important, infrastructure growth will add to the demand for steel manifold. That is why the World Steel Association (WSA) expects India to become the third-largest producer of steel by 2013 (today it ranks fifth), if not earlier.”
These numbers could rise even further with the emergence of new towns and cities, and the building of better highways and railway networks. Not surprisingly, every industry analyst expects domestic steel production to virtually double from the current 57 million tonnes a year to 124 million tonnes by 2012.
More interestingly, India’s consumption growth is likely to overtake China’s growth rate.
“While India’s consumption of steel continues to soar at over 14% CAGR per annum, China’s consumption has slowed to 5%,” adds Bharadwaj.
This is lower than the 6% for all Brics countries, and even lower than the world growth rates.
What this means is that China will have more steel for export, so expect market prices of steel to soften. But that is where the uncertainty begins.
Cristiano Ronaldo sends heartfelt retirement message to former Real Madrid teammate Marcelo Viera
Jeet Adani, Diva Shah are now married! Here's why their wedding was more than a mere celebration
IIT-BHU student gets highest package of Rs..., average package in 2025 is...
Music composer Anu Malik sells two Mumbai flats in Santacruz West for Rs..., co-owner is...
Jeet Adani and Diva Shah are now married; video of varmala ceremony goes viral, WATCH
Jeet Adani-Diva Shah wedding: Gautam Adani shares first pics of son's wedding, see here
Can Kejriwal win prestige battle? What are the key factors that dominated Delhi assembly polls 2025?
Subhash Ghai makes big investment, buys plush 4BHK apartment in Mumbai for...
Metovalex App Review 2025: Legit Or Scam Trading AI? - Real User Facts!
Deepinder Goyal's Zomato rebranded Eternal: Everyone has the same question
Thief gifts Rs 3cr house to girlfriend, everyone shocked after...
Who is Meghnad S? YouTuber and journalist who contested Delhi assembly polls 2025 from...
Does Sanya Malhotra's 'Mrs' promote a no-marriage culture among women?
BIG blow to Sundar Pichai as Google loses Rs 17501260000000 due to…
Caring for Ageing Parents? Essential tips to manage health, finances, and well-being
Jeet Adani-Diva Shah wedding: Inside pics from Gautam Adani's son's wedding festivity
Meet Gautam Adani’s daughter-in-law Paridhi Adani: Know about her assets, career, family, and more
Why has Premanand Maharaj stopped his morning yatras at 2 am?
Sonu Sood BREAKS SILENCE on arrest warrant against him in fraud case: 'It is sad that celebs...'
Akshata Murty once confronted her father and Infosys co-founder Narayana Murthy: 'My real dad is...'
Meet Alexis Wilkins, Trump's FBI chief pick Kash Patel's 'mystery girlfriend,' her profession is...
Fire breaks out at Mahakumbh Nagar camp, officials say no casualties reported so far
Who is Mohini Mohan Datta, mystery man set to get Rs 500 crore through Ratan Tata's will?
Cristiano Ronaldo makes shocking statement, breaks Portugal's hearts: 'I never thought about...'
Ludhiana court issues arrest warrant against Sonu Sood in fraud case
Happy Rose Day 2025: Significance of different coloured roses on Day 1 of Valentine's week
Salman Khan REVEALS why he avoids eating beef and pork: 'Main maanta hu meri maa...'
Shah Rukh Khan-Saif Ali Khan vs Aryan Khan-Ibrahim Khan: Who should be in KHNH2!
Why Israel's Benjamin Netanyahu gifted Donald Trump golden pager? It is a reference to...
Mob in Bangladesh destroys ousted PM Sheikh Hasina's family home
ISRO's EOS-06 satellite captures Phytoplankton concentration on global scale
IND vs ENG: Will Virat Kohli play in 2nd ODI vs England? Shubman Gill provides huge injury update
Who is Kiran Chaudhury? PCS officer caught in bribe case, just 4 years after posting
Jeet Adani-Diva Shah's wedding today: Know venue, gifts for guests and more
Meet woman, who works in Rs 163000 crore company, daughter of Hyderabad’s richest man
This is world's greenest railway station, 170 years old, home to over 7,000 plants, it's in....
As Sky Force nears Rs 150 crore, Nimrat Kaur treats househelp, her kids with movie screening
IND vs ENG: Shreyas Iyer creates history, becomes first player to achieve THIS massive milestone
Meet man, India's richest banker, who has bought Rs 202 crore property, his net worth is Rs...
'Heard there was....': Former India head coach provides major update on Virat Kohli's injury
A New Geopolitical Era: India and Israel's Role in the Evolving Middle East
David Warner’s touching moment with fans after Dubai Capitals reaches final of DP World ILT20
India’s Largest Book Stall Network: PrashantAdvait Foundation’s Mission to Revive Reading Culture