Scrap Metal Prices and Scrap Metal Auctions

The US financial crisis and a depreciating rupee are likely to arrest the demand for higher steel imports into India. The development comes at a time when the domestic steel industry is already facing a spike in imports with demand outstripping production at home.

“The US steel industry is facing the brunt of the crisis which originated in the real estate sector. The realty sector accounts for nearly 50% of steel demand in the US. The resultant slump in US steel sector would have led to flooding of steel into India. However, a weak rupee has made imports costlier and may in turn, restrain unnecessary imports,” an industry source said.

“This year, imports may be higher than last year. Global prices are softening and this has led domestic producers to cut down prices too. However, the impact will take some time to get reflected on imports since it is always follows after a lag,” a steel ministry official told ET.

Demand growth at 11.2% has far outsripped domestic production in India which has seen a growth of 5.5% this year. On a half yearly basis, steel imports have touched around 3 million tonne, up 50% over imports in the same period last year. Benchmark global steel prices for hot rolled (HR) coils have come down to $350 per tonne against a high of $800-1000 per tonne a few months earlier. In step, domestic steel majors have also cut prices.

The US has been showing signs of a decline with imports dropping over 19% and 11% in July and August 2008 over last year.

Courtesy www.worldscrap.com  and www.economictimes.indiatimes.com

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