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Steel sector witnesses subdued growth in consumption

Steel sector witnesses subdued growth in consumption
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Data from the union steel ministry shows that consumption of finished steel in the country rose a mere 3.9 per cent to 54.8 million tonne (mn t) in Apr-Dec 2012 from 52.7 mn t in the year-ago period.

Industry watchers attribute the muted growth in steel consumption to the subdued demand from the end-users.

Some industry observers feel that the demand growth may not recover significantly in the remaining period of the current fiscal because of slowdown in construction, automobile and other sectors that use steel.

It is learnt that steel consumption generally gains momentum following the festival season in October and reaches its peak during the January-March quarter when construction activity gains pace and sales of consumer durables pick up.

Earlier this month, auto industry body SIAM had revised car sales projection for the fourth time in the current fiscal to 0-1 per cent, down from the first ambitious estimation of up to 12 per cent.

Some experts feel that growth in the steel consuming sectors like construction, infrastructure, automobiles may recover if Reserve Bank of India (RBI) cuts policy rates in the forthcoming policy review on January 29.

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