Construction Industry News
India’s steel output was down by 3.2%, though large steel makers have been talking about buoyant demand. One reason could be the shutdown of Ispat Industries Ltd’s steel plant since early November. The plant has been restarted recently. Another reason could be higher iron ore prices and lower conversion margins between sponge iron and billets, leading to smaller steel companies selling sponge iron instead of steel, according to a Motilal Oswal Securities Research report.
Indian steel companies are in a comfortable position,as lower Chinese output has brought down the threat of imported steel flooding the market.In November, steel imports were down by 62% over the year-ago period. Also, the ban on iron ore exports has given steel makers an edge. Since their capacities are not enough to meet domestic demand, they will depend on steel prices rising to see their performance improve in fiscal 2012 as well. That depends on a few key factors: chiefly whether developed economies recover and when China returns to its earlier high growth levels.
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