|Another Bollywood "Dumbo"|
Monday, December 29, 2014
Domestic steel industry is not getting adequate iron ore to produce steel: Seshagiri Rao, JSW Steel
December 20, 2014: JSW Steel is India's leading private sector steel producer having $9 billion global conglomerate spread over six locations in India and a footprint that extends to the US, South America and Africa. Recently, the company was in news as they plan to build a 10 million tonne greenfield steel plant at Salboni in West Bengal. Currently, the project is on hold as the ban on iron ore mining and cancellation of coal mines has brought in severe uncertainty to raw material linkages for the project.
The stock of the company is trading flat. In an interview with CNBC TV18, Seshagiri Rao, Joint MD and Group CFO, JSW Steel, said that one of the reasons for the stable growth is the currency devaluation which has been putting pressure on global steel prices and adding to the Chinese slowdown. Thus, the countries which are export dependent are producing more steel and looking for markets – that is also supported by the devaluation of those currencies and that is why in this quarter we have seen the prices dropping internationally.
Explaining it in detail, he said, "We see little stability in the prices because scrap prices have started looking up. Earlier, it was below USD 300 and now we see it rise to USD 320 per tonne. Iron ore is around USD 70 and coking coal is at USD 110, which are all indications that the stability is there in the prices internationally. So correction already happened in the last two-and-a-half months".
Further, drawing attention over the mining scenario in India and decisions taken by the State and Centre government, he commented, "As far as the iron ore overall production relative to the demand is concerned, there is a gap. There is a lot of hope that more production will come into operation either in Odisha or Karnataka but we are not seeing anything happening on the ground. That is why the imports of iron ore are increasing into India, so in this year at least 10-15 million tonne of iron ore imports are happening.The major concern today is the domestic steel industry is not able to get adequate iron ore to produce steel, so we are importing steel into India because of lack of iron ore in India."