New Delhi: JSW Steel sees raw material prices declining this fiscal year, but an uptick in demand and in global steel prices would nudge up domestic prices in the September quarter, its managing director said on Tuesday.
Sajjan Jindal said India’s No. 3 steel maker would import coking coal at an average price of $100 a tonne, about two thirds below last year’s price, while iron ore from leading domestic miner NMDC would likely be cheaper by a third.
But prices of steel are likely to rise 2% in the July-September period, and JSW itself would consider a revision next month, Jindal said.
“Right now there is a slight upswing in international markets. There is a slight improvement in steel prices. The impact of that would also be felt in India,” Jindal said on the sidelines of a conference.
There are some signs of a nascent recovery in steel prices in some Asian economies, with restocking and a slow pick-up in demand from end users.
Jindal said demand for steel in India being helped by consumption in the auto, construction and infrastructure sectors.
The government expects India’s steel demand to rise 5% in 2009-10, after flat growth in the previous year. The World Steel Association’s forecast is for about 2% growth.
JSW’s product sales in May rose by 50%, he said. The firm expects to produce 6.1 million tonnes of steel this fiscal year, 72% more than a year ago, helped by capacity additions. It has an annual capacity of 7.8 million tonnes.
The additional capacity would mean an increase in coking coal imports to 5 million tonnes this fiscal year, up from 3 million tonnes a year ago, Jindal said.
JSW’s 1.2-million-tonne plate mill plant in the United States would continue to run at 20% of its capacity till demand picked up in that country, Jindal said, but it would not be shut down or sold.
By 2:50 pm, shares in JSW were trading 0.74% lower at Rs563.10 in a weak Mumbai market.