India 10th largest in stainless steel production in the world

Hyderabad - India is to become outsourcing and manufacturing hub for stainless steel products in world market by 2015. Indian Stainless Development Organisation(ISDO) will be the nodal agency and will bridge the gap between foreign companies and Indian companies informed Hitendra Bhalaria, Vice President of ISDO in a press note issued in Hyderabad today.

India is ranked 10th in the stainless steel production in the world. India produces 18 to 20 lakh ton per annum and with some import, the consumption of stainless steel in India stands at 22 lakh tons. This also includes exports worth 2.50 lakh ton per annum. Ahmedabad is considered No. 1 for production of raw materials. Mumbai is the biggest stainless steel trading centre in Asia for raw materials and finished products. There are more than 3000 traders in Mumbai.

The per capita consumption of stainless steel in India is 1.2kg, which is the lowest in the world. On the other hand, the world's highest consumption per capita is 30kg in Italy, 24.6kg in South Korea, 21kg in Germany, 16kg in Japan and 6kg in China. The world average per capita consumption is 9.4kg. Hence, there is tremendous scope of increasing production and consumption of stainless in India, informed Hitendra Bhalaria.

In this light of background, ISDO and Steel Market Info are jointly organising Indinox--Stainless Steel Fair from 16th to 19th January at Ahmedabad. Virbhadra Singh, Union Minister of Steel to inaugurate this International Conference. The fair has been supported by more than 32 association country wide. The objective of the fair is to generate greater awareness in customers about different usages of stainless steel other than untensils as well as on different types of stainless steel wares. India is the only country where 74% production of stainless steel in utilized by utensil manufacturers and for exports.

The usage and application of Stainless Steel is fast expanding in various fields like houseware, hardware, furniture, SS jewellery, machinery, Pipe-wire-coil-sheet (patta-patti), railway vendor, architectural, building and construction, sanitary equipment, dairy, automotive, ferro alloys and allieds. Recently, Government has permitted usage of Stainless Steel for manufacturing of gas cylinders. Stainless Steel is also getting popular in use for construction industry for tore steel and binding wires, for water tanks in high rise buildings, concealed plumbing for bathrooms, architectural use in airports, railway wagon and railway stations, bus stand, signage, dustbin, etc.

ASSOCHAM has projected that the domestic steel industry would grow by 10% to 12% against the Normal Steel Policy (NSP) target of 6.9% growth by 2012. By 2012, the operating capacities of indigenous steel industry will rise to 73 MTPA against NSP projections of 57 MTPA. Currently, steel sector operates at 42 MTPA capacities.

World stainless steel demand is expected to rise 4.9% per year to 2010. Stainless Steel demand in India and China is presumed to be 7% per year and 8.45 per year respectively during this period, while annual growth in the rest of the world is expected to be 4%. Projections for 2010 to 2015 suggest a 4.2% annual growth in world wide stainless steel demand, with growth reaching 7.7% per year for India and 6.2% per year for China during the same period.

As per "Outlook for Global Steel", the world wide stainless steel industry will achieve significant growth of 3 to 4% per year through 2015, reaching 1.55 billion to 1.7 billion metric tons annually. Over the same period, sustained high prices of raw materials and increasing consolidation will help to stabilize stainless steel prices. The long term profitability of the industry will likely to be better than during the "stalemate" years of 1974-2001 but not as strong as during the recent boom.

Source : Equity Bulls

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