With an increase in demand from sectors such as automobile and consumer durables, India's steel consumption witnessed a 5.8 percent rise to 17.31 million tons in April-July 2009 over the same period last year.
The steel consumption in the April-July 2008 period stood at 16.36 million tons, according to the Steel Ministry. On the back of a firming demand, the domestic steel production rose by 3.8 percent to 18.77 million tons in the reporting period as against 18.09 million tons in the same period a year ago. Leading steel producers like Tata Steel, SAIL and JSW Steel reported significant growth in steel production in the last few months. During the months under review, imports and exports went down by three and 41.3 percent, respectively, over the same period a year ago. In the April-July period, while imports stood at 1.99 million tons, the exports were at 0.92 million tons. However, in July, alone, imports surged by 3.2 percent to 0.56 million tons over the year-ago period. According to an analyst, the current spurt in steel consumption as an indicator of "stability" in the economy. As for now it is a good indicator. The present growth is led by the demand for flat products primarily by the automobile industry.
However, he said that it will be too early to predict that whether the current trend has long life or not. He added that sharp rise in steel production and consumption will be witnessed in the coming months, mainly due to the base-effect, as output and offtakes were down in the latter part of the last fiscal. The World Steel Association has forecast steel demand in India to grow by about two percent in 2009-10, while for rest of the countries its projection is a negative growth rate of 15 percent. To cash in on the surge in demand for the flat steel products, leading steel producers like SAIL, Tata Steel and JSW have already increased the prices of their products by up Rs 1,000 per ton, effective August 1. However, prices of long steel products consumed primarily by the construction sector were cut in the range of Rs 500-2,000 a ton due to sluggish demand amid a poor monsoon.

Steel Minister Virbhadra Singh asked the country's largest steel producer Steel Authority of India (SAIL) to complete its ongoing Rs 70,000-crore programme on time, refering the surge in domestic steel demand.
"The economy looks set for a rebound...this will translate into decent demand growth for steel in the near future," Singh said adding, this was the appropriate time to achieve the targeted production capacity of 23 million tons per annum (MTPA) by 2012 from the present 14 MTPA.
While appreciating the first quarter performance of the steel giant during a review meeting, he said the recessionary trend would settle down in the next few quarters. The steel major reported a 27.7 percent decline in net profit at Rs 1,326 crore for the April-June quarter.

Tata Steel announced a worst-than-expected 47 percent fall in net profit in the first quarter due to weak prices, but the company said higher volumes and lower costs will improve profitability in the second quarter.
The world's sixth largest steel producer saw its standalone net profit falling to Rs 790 crore from Rs 1,488 crore in the year ago period, while sales dropped 8.7 percent to Rs 5,554 crore in the quarter, as customers postponed purchases in a falling market.Prices of hot-rolled coils were hovering between around Rs 26,000 per ton in April-June quarter, compared with Rs 45,000 a ton in the same quarter last year. Prices, however, started surging up in July thanks the massive stimulus packages in the US and a general improvement in the liquidity condition.
“But things are improving...here and globally,” said Tata Steel managing director B Muthuraman. The company's European unit Corus has already raised steel prices by around $40 a ton, while capacity utilisation in Europe may go up to 65 percent in the next quarter from 53 percent at present.
International operations are vital for the company, as Indian operations account for only 25 percent of Tata Steel's combined capacity of 30 million tons. In fact, the group's consolidated net profit for the quarter fell due to slow sales in Europe.
The first quarter saw a 22 percent rise in sales volumes in India, as demand for long steel products — which are used in construction — grew in anticipation of increased government spending in infrastructure.

The country's one of the major steel producers JSW's Rs 70,000-crore project to set up 20 million tons per annum (MTPA) of steel facilities will be delayed further. The company said it would review the held decision in 2010-11.
The company had proposed to set up two integrated steel plants with an annual production capacities of 10 million tons each in Jharkhand and West Bengal. JSW had started the work on the phase-I of West Bengal project but any installation was yet to start at the Jharkhand facility.
Due to the global slowdown, the company had put on hold the construction of the steel plant in West Bengal.
"The greenfield projects are on hold. They will be only reviewed in FY11," JSW Steel Joint Managing Director and Group CFO Seshagiri Rao said. The steel firm had already slashed investment by a third to Rs 4,000 crore in the first phase for setting up the plant.
The company had not mentioned any time-line for the 10-MTPA plant proposed in Jharkhand, where the company is in process of acquiring land and developing mines for the proposed plant. JSW Steel had already acquired the needed land in West Bengal and was setting up beneficiation unit, pellet plant and developing mines.
However, Rao said, the company will achieve the 10-MTPA capacity at its Karnataka plant by March 2011.

India, the world's third largest iron ore supplier, is considering putting curbs on exports, Steel Minister Virbhadra Singh said. But he did not give any timeframe.
"Our first priority should be that all iron ore within the country should be utilized for making steel in the country," Singh said.
Spot iron ore prices in China, which buys about a fifth of its iron ore from India, have nearly doubled since April.
The surge in global prices has put increasing pressure on Indian steel mills, and New Delhi has in the past used duties as a way to curb domestic prices by keeping more supplies at home -- measures that would threaten to increase global prices.
Any hike in Indian export duty prices and a resulting rise in global iron ore prices, might be temporary, said an analyst with the World Steel Dynamics consultancy.
"It might have a short term impact on the Chinese market but it isn't likely to last. Indian ore is all sold on the spot market and any increase in tariffs will be small compared to market movements," the analyst said.
"Prices are likely to fall anyway after rising so much in the last few months." China imported 62.49 million tons of iron ore from India in the first six months of this year, comprising 21 percent of its total imports.
"They want to reduce the prices.. they might bring in some duty," said a mine executive in India's southern Karnataka state. "The international iron ore market has been hotting up, so naturally it will be disadvantageous for steel companies."
Export duty on iron ore lumps is 5 percent now and on iron ore fines it is nil, but miners have been bracing for a possible increase in duties for several months.

Tata Steel would channelise 50 percent of its iron ore and coking coal -- key inputs for making steel-- to its European subsidiary Corus by 2015 in a move aimed at securing raw material for the Anglo-Dutch steel maker and cut operational cost.
The world's sixth largest steel firm is also looking to save one billion pounds at its European operations in 2009-10 by pursuing its cost-cutting programmes - "Weathering the Storm" and "Fit for Future." "The fundamental thing is our strategy to get raw material license to ensure that over a period of next five-six years, Corus or Tata Steel Europe as it is now called, gets 50 percent of the raw material," Tata Steel Managing Director B Muthuraman said.
The raw material for Corus would come from company's mines in Mozambique, Canada and South Africa besides other places, he said, adding that the initiative would take a few years to complete. The company would continue to scout for more coal and iron ore assets abroad.

Cash prices for iron ore delivered to China from India surged 10 percent, the biggest gain in two months, due to increasing demand from the world's biggest steelmaker and buyer of the raw material. The spot price for ore from India climbed to $111 a ton, the highest since October last year.
That measures the price of material with 63.5 percent iron ore content. Iron ore from Australia for immediate delivery advanced 9.2 percent to $104.1 a metric ton for the week ended Aug. 7. That's for ore with 62 percent iron content. Both prices include freight charges.

ArcelorMittal, the world's largest steel producer, plans to make India and China the sourcing hub for its greenfield projects equipment to bring down overall costs. Speaking on the sidelines of an event organised by the Confederation of Indian Industry (CII), ArcelorMittal Design & Engineering Centre CEO Pierre Jonette said that the main objective is to bring down the total project cost by 20-22 percent across all the green projects.
The company has internally decided to increase sourcing from local low cost destinations for most of its greenfield projects. The cost of equipment in India and China is about 30-40 percent cheaper than in Europe and other markets. Also, there was a greater scope for localisation in India and China compared to other markets. Cost of equipment roughly constituted half of the total project cost. India stands to be the biggest beneficiary as the two of the biggest greenfield projects of ArcelorMittal are being planned in India.
The company has plans to build two steel plants each with a capacity of 12 million tons each in the state of Orissa and Jharkhand. The two projects are delayed because of government approvals and the targeted schedule for both the projects is end of 2013 or beginning 2014. Despite the delay Jonette said, there would be no downsizing. The company is still working on the capex, product-mix, lay out etc. The company also had new projects in Saudi Arabia, Kazakhstan and Brazil, he said. While from India the company was looking to buy equipments such as boilers, steel structures, infrastructure, from China, it was looking at sourcing blast furnace, coke oven and sinters, said Jonette. The in-house dedicated design and engineering centre of ArcelorMittal (AMDEC), which was inaugurated last year, will help in greater optimisation of resources and downsizing cost.

The country's largest iron ore producer NMDC Ltd is planning to invest $5 billion in the next five years to expand capacity and enter the steelmaking business. The company plans to lift output 67 percent to 50 million tons in three years.
NMDC, which aims to construct a 3-million tons factory in the eastern state of Chhattisgarh, is also planning to build another factory in the southern state of Karnataka. NMDC is expanding as a steelmaker to increase production to supply to automobile companies and rural and urban public works projects. The government has allocated Rs 1790 crore in the budget year ending March 31 to build networks of roads, telephones, electricity and irrigation. The Centre plans to divest 8.38 percent of its stake in NMDC. The stake sale will fetch Rs 1200 crore at current prices.

Crisis-hit European steel producers' sales will go down by 75 percent in the wake of the global economic slowdown, and India and China will be the ones to buck the trend, said Tata Steel Managing Director B Muthuraman.
"This would be a difficult year for all European companies including for Corus as both demand and price have halved thereby affecting over 80 percent on company's revenue,” he added. In India, however, prices have declined to half but demand still remained upbeat. India and China are the only two countries where demand is positive, with China recording a growth of 4 percent and India doing better at 5.5 percent in April-June 2009 compared to the corresponding period last fiscal. Between January and June this year the global demand has dropped by 35 percent. Of this, the demand in the US is down by 50 to 55 percent, 40 to 45 percent in Europe, by about 50 to 55 percent in Russia and Ukraine, and down by about 20 percent in Japan and South Korea.
He attributed demand growth in India and China to a number of steps, including stimulus packages, taken by the governments. The very fact that Indian steel demand is up by about 5.5 to 6 percent compared to 50 percent down in rest of the world is...A reflection of the government's good policies. While the US will take 18 months to come back to normal, Europe will take longer two to three years, he said adding, signs of recovery were visible as far as Indian and Chinese economies were concerned.

The government has set up a committee to suggest ways to make four ailing steel PSUs efficient and profitable.
The steel ministry had appointed the committee in June to examine the structure and functioning of the four state-run entities -- MSTC, FSNL, KIOCL and HSCL -- and suggest ways to strengthen their operations. The committee, led by former CMD of Kudremukh Iron Ore Company Ltd (KIOCL) P Ganesan, was given two months to submit its recommendations regarding the four PSU's re-organisation, merger with other companies or structural re-alignment. For KIOCL, the ministry is mulling a strategic- partnership with iron ore miner NMDC. After a Supreme Court ban on mining in Western Ghats for iron ore in 2005, the company was finally shut last year.

OTata Steel may supply steel for automobile companies Toyota and Nissan for the production for their cars in India.
The world's sixth largest steelmaker to meet 40 percent of steel demand of the auto sector already provides nearly all the steel for some of Toyota's cars. It now has approval from Nissan too.
Avneesh Gupta, Chief of Total Quality Management of TATA Steel, said TATA Steel produces 1.5 million ton per annum of flats for autos. He told, “It is also one of the few to manufacture steel skins, the outer cover of cars. It plans to double the skin production of 50,000 tonnes to 100,000 tons.”
Nissan plans to roll out its compact car, Micra from the Nissan-Renault facility in Chennai while Toyota plans to build a new car on a new platform to enter the Indian small car market..

India's largest steel producer Steel Authority of India (SAIL) posted 27.7 percent fall in its net profit at Rs 1,325.09 crore for the quarter ended June 30, as compared to Rs 1,835.10 crore during the same period year.
The steel major also announced that it will invest Rs 10,300 crore in the current fiscal for expansion and upgradation.
However, SAIL's net turnover has dropped by 16.5 percent to Rs 8,950.64 crore from Rs 10,722.28 crore.
“Our thrust in this quarter and in the coming quarters would be on operational efficiency. We plan to invest Rs. 10,300 crore during the current fiscal, out of which Rs. 2,470 crore has already been invested. The joint venture with Shipping Corporation of India for vessels to carry coal supplies is in the pipeline and the joint venture with JP Associates for a cement plant will become operational by June 2010,” SAIL Chairman S. K. Roongta said. He said the option of sale of stake was open and could be explored in the long run. However, he said the company was satisfied with the numbers and attributed the rising loss to substantial drop in realisation and higher cost of input material.
He said the expansion plans of the company would be carried out as per planning and projects in Salem, Rourkela and Bhillai would be implemented to enhance the capacity of the company from 14 million tonnes to 23 million tonnes by 2012. “We are going ahead with the expansion plans. Out concern right now is the high cost of manpower and material security issues relating to mines, iron ore that have been pending,” he added. He said it was estimated that in July there would be 10 to 11 per cent growth in production and 12 to 13 per cent growth in sales.

Tata Steel, the world's sixth largest steelmaker, is in talks with two mining firms in Vietnam and South Africa for joint venture for securing smooth raw material supply for its global operations.
The company in its annual report for 2008-09 said that it has an option in a South Africa iron ore mine to enter into a joint venture with the promoters and the project is currently evaluation.
Tata Steel will also take a minority stake in an iron ore mine in Vietnam to feed its proposed JV unit there. "Tata Steel will take a 30 per cent share in the Thach Khe iron ore mine that is about 60 km from the steel project,'' the report added.
The company in 2007 entered in an agreement with Vietnam Steel Corporation to set up a mill, which Tata will hold 65 percent stake in the JV. The South African mine would primarily cater to its European steel firm Corus, which lacks raw material security.
“The highest priority is being given to ... ensuring raw material security for the European operations which do not have captive iron ore and coal resources,'' Tata Steel Chairman Ratan Tata said in the report. Tata Steel, however, did not give details of estimated reserves of the two mines.

Uttam Galva Steel Limited, a manufacturer of valued-added steel, decided to increase the prices of its galvanised steel products by Rs 2000 per ton.
The company said an increase in prices of HR coil by integrated steel producers for the domestic market has necessitated the price hike in galvanised steel.
India's steel major Tata Steel recently hiked spot prices of hot-rolled (HR) products by Rs 500-1,000 a ton as did SAIL. In the past few weeks, steel and base metal prices have surged on the back of encouraging corporate results in the US.
The rise in metal prices is also going to end the party for companies that have been making high profits on the back of low raw material cost.

There is rosy picture ahead for the Indian steel industry and the task clearly is to SAIL past the present difficult times, said P K Bishnoi, CMD, RINL.
Speaking at the International Convention on Clean, Green and Sustainable Technologies for Iron and Steel Making in Bhubaneswar, the said that India has been adjusted by world steel dynamics as the best location in the world to set up a steel plant as India offers abundant iron ore reserves, low worker wage costs, a sharply growing market, a good location of exports and an incredible group of managers that are seeking to exports as fast as possible.

The Chhattisgarh government has issued notices to 45 small steel and sponge iron units for violating pollution norms.
Rajesh Munat minister of Housing and Environment said, “The state government has served notices to 45 steel units and sponge iron units based on Urla Siltara industrial growth centre on the outskirts of Raipur for overlooking pollution control measures and also not using electro static precipitator machines.” Munat said “The government would take firm action against industries which are consistently failing to control the emissions.”
However, the state assembly after a lengthy debate Friday rejected a proposal moved by Mr Mohammed Akbar the opposition Congress member that licenses of industrial houses not using ESP machines be suspended for 1 year.

JSW Steel whose US unit has been running at 20 percent capacity is seeing some demand pick up in North America.
According to Sheshagiri Rao joint MD& group CFO, while the plate market is up relative to what it was, new enquiries are coming in for pipes. He said that orders for a total of 83,000 miles of pipelines are expected over the next 12 months, requiring 49 million tons of steel.
Rao said, “A significant part of this demand is from West Asia, Asia and North America. So we expect some sort of revival by the year end.” JSW Steel's US plant has a capacity of 500,000 tons for pipes and a million for plates. Before the slowdown dragged operations to its current low, the US business was manufacturing 30,000 tons of pipes and 60,000 tons of plates. JSW Steel has also gone scouting for buyers in Mexico and Africa for the steel it produces in the US, but is yet to find takers.

Welspun Power and Steel Ltd, part of Welspun Group, will set up a fully integrated 1.5-million tons per annum steel plant through a SPV with an investment of Rs 6,000 in Raigarh, Maharashtra.
A Memorandum of Understanding (MoU) has been signed between Ashok Tandon, Director of WPSL and Azeez Khan, Principle Secretary, Industry of Maharashtra.
The company will additionally increase the capacity of its existing DRI facility from 0.9 million tons per annum to 1.5 million ton annum. About 5,000 people will be employed at the plant. Azeez Khan said, "It is highly satisfying to see yet another major industrial player establishing a new mega project in Maharashtra and entering into a partnership with the state. Welspun's project will benefit the local area and people, as well as the state as a whole.”
Welspun aims to start commercial production of this facility by April 2012. It believes that this facility would not only lead to the socio economic development of the region but also aid ancillary industries and infrastructure without disturbing the ecological balance. Along with efficient utilization of the port, the facility would help in developing hospitality and tourism industry in the region.

The Karnataka government is planning to develop a 300-km 'steel corridor', and expects this project to attract investments worth Rs 20,000 crore from steel majors. The corridor, which is expected to create 200,000 direct and indirect employments, is planned around the iron ore-rich Bellary-Hospet area in eastern Karnataka.
Speaking on the sidelines of the Confederation of Indian Industry (CII)'s Suminfra 2009 meet, V Madhu, principal secretary (infrastructure development), said the state wanted to move from just exporting ore to value-added production of steel. Mining and steel majors including NMDC, Tata Steel, JSW and Brahmani have evinced interest in the project. The idea is that each steel manufacturer could erect a manufacturing unit of at least two million ton. Work on a 120-kilometre rail link between Hubli and Ankola and identification of 500 square kilometre of land for the industrial park is already on. Tenders for development of the park will be floated in two months. Madhu said the government also wanted a nuclear power unit in the corridor.

Iron and steel producer Ispat Industries Ltd announced a net loss of Rs 214.92 crore in the first quarter ended June 30, 2009.
It had earned a net profit of Rs 28.73 crore in the same period last fiscal, Ispat Industries said. Total income of the Kolkata-based company decreased to Rs 1,399.68 crore for the quarter under review from Rs 2,875.78 in the same period previous fiscal. The company manufactures direct reduced iron, hot rolled coils, pig iron/hot metal, cold rolled/galvanized coils/sheets and colour coated sheets.

Bhushan Power and Steel Limited has completed the last stage of the phase II expansion programme.
The company will install one of the world's most modern combined wire rod and bar mills adjacent to their new integrated steel plant in Jharsuguda in Orissa. The core technology of this new 500,000 tpy rolling mill is a 3-roll Reducing and Sizing Block (RSB) of the latest generation of FRIEDRICH KOCKS GmbH & Co KG, Hilden / Germany.
The order comprises the design, supply, erection and commissioning of a 4-stand 3-roll RSB with a nominal roll diameter of 370 mm.
The Reducing & Sizing Block is prepared for a possible future extension to five stand positions and will be implemented after stand No. 18 of the 2-high roughing and intermediate mill. As a finishing block, the RSB rolls finished straight bar lengths within the range of 16.0 to 80.0 mm Ø and hexagons within the range of 18.25 to 50.0 mm onto the cooling bed as well as bar in coils of 16.0 to 60.0 mm Ø. As a pre-finishing block, the RSB produces all necessary pre-sections for the downstream wire rod finishing block.

India's third-largest steel maker, JSW Steel Ltd's crude steel production for July rose by half to 0.5 million tons.
Flat rolled products output rose 45 percent to 0.3 million tons in July, while long rolled products surged to 61,000 tons from about 12,000 tons a year earlier, the company said in a statement to the BSE.

Techno Fab & Mineral's, a Physical & Metallurgical Test Laboratory, was inaugurated by Brajmohan Agrawal, Minister of PWD & State Tourism. The lab is located in Raipur.
It has facilities to test iron ore, fines, sponge iron, coal, vanadium, manganese ore, pig iron, blue dust and ingot. All tests are being done as per the norms of Bureau of Indian Standard's (BIS), said the company press release.

Usha Martin Ltd, manufacturer of wire and wire ropes and special steel, received an order worth $3 million for supplying 1,200 tons of special wire ropes to China Oil Company for meeting its requirements for drilling and exploration operation.
With this order, the company has entered the Chinese market for the first time. B K Jhawar, Chairman, Usha Martin said," We hope to supply annually about 2,000 toms of wire ropes valued at USD 5 million." He, however, added that the Chinese market would be taken care of by the company's wholly owned subsidiary in Singapore, Usha Martin Singapore Pte Ltd.
Jhawar said that Usha Martin has also floated a subsidiary in Vietnam, Usha Martin Vietnam Company Ltd to cater to the growing market of that country.

Economic think tank Centre for Monitoring Indian Economy expected dip in contract prices of iron ore and coal, steel prices are like to fall by 3 percent to 5 percent by September.
CMIE in its monthly review of the Indian economy said, “We expect domestic steel prices to dip by around 3% to 5% across product categories in the next 3 months ended September 2009.”
It said, “The domestic prices of steel is already 7 percent to 8 percent higher than global prices which is indicative of the fact that the prices are yet to be bottomed out domestically.”
CMIE added that the uptrend in international prices seen in June might not sustain due to overcapacity in the global steel industry and that the domestic steel prices move in tandem with international prices.
It added, “While the prices will remain weak, the revival in steel demand will sustain in 2009-10, driven by healthy demand for long steel products used in construction and the expected pick up in housing construction in the H2 of the year.”

Electrosteel Integrated Limited, which is setting up an integrated steel plant in Jharkhand plans to start production by the next financial year 2010-11.
According to report, the plant of 3.5 million ton per annum capacity is coming up at Chandankyari, 22 kilometer from Bokaro, at an estimated investment of over 8,000 crore. It has already purchased 2,500 acre of land on which civil construction has started and needs another about 1,000 acre of land. It has tied up with Chinese consultancy agencies, 23 MCC and CFMCC for technology transfer based on successfully operating integrated steel plant at various places in China. For coal mining, the company is using Ukrainian technology.
According to an official, the coal washery is ready and trial run is going on. It will be in a position to start production by the next financial year. Work on transmission line is going on. We have also started work on the housing colony for the employees.
It has been allotted captive mine blocks for coking coal in the Jharia coalfield near Bokaro. The Centre has approved the company's proposal for 192 acre mining lease at Kodalibad near Barajamda. It has also got permission for drawal of ground water for construction purpose from the office of the ground water investigation division, Ranchi.
The nearest railway station Talgarea, which is about 12 kilometers away from the proposed plant site is having a single line electrified traction system. The railway link for the proposed plant is to be developed from this railway line with a take off point at Shewbabudih station. Meanwhile, it is also engaged in different CSR activities in the areas of health and education. Orders for the plant of over INR 4,300 crore have been placed with overseas suppliers. Critical plant and machinery such as blast furnace have started arriving at the port.