Sugar seen gaining on retail demand
Retail offtake of sugar is expected to rise the next two days as Maharashtra traders are likely to intensify their strike against the local body tax.
Sources said that the traders, including those in sugar, dry fruits, spices, gur, colour and chemicals, coconut and others business, have decided to join the strike from May 1.
The trend was reflected in the futures market, where prices were up by Rs 23-24 on expectation of higher physical demand ahead of the indefinite bandh from Wednesday, said sources.
On Monday, sugar prices on the Vashi wholesale market ruled steady with the fine quality gaining marginally and the fair quality dropping a tad as local demand was thin.
In the spot market, prices dropped by Rs 5-10, while naka rates showed a mixed trend. Mill tender rates ruled unchanged due to subdued demand. In the Vashi market, new arrivals were about 62-63 truckloads, while local off take was about 63-64. On Saturday evening, 8-10 mills offered tenders and sold 25,000-30,000 bags at Rs 2,900-2,970 (Rs 2,900-2,970) for S-grade and Rs 2,980- 3,060 (Rs 2,980 - 3,090) for M-grade.
Steel mills push exports through discounts
India’s steel exports surged more than 14% in the fiscal year ended March, not so much by capturing new markets than clearing inventory though discounts.
The discounts were pegged at 2-3%, more on bulk sales, to countries in West Asia, South-East Asia, the South Asian Association for Regional Cooperation (Saarc) and Africa, mainly on steel used in construction, white goods and electrical applications, company executives and analysts said. “It is not very remunerative to export…this is an export made in desperation,” saidNarendra Chaudhary, a mining and metals consultant and former executive vice-president and chief executive for Asia, Africa and East European countries for ArcelorMittal, the world’s biggest steel maker. “You can’t compare exports of pre-2008 to exports now.”
Inventory at three companies—Steel Authority of India Ltd (SAIL), Tata Steel Ltd and Rashtriya Ispat Nigam Ltd—stood at 1.39 million tonnes (mt) at the end of December, double the 691,000 tonnes from a year ago, according to data from Oreteam, a steel and iron ore information website.
“All of them are seeing low sales in India so they are looking here and there trying to find new markets,” said Prakash Duvvuri, head of research at Oreteam. “This fiscal year, exports could rise and there could be some discounts again.”
Steel exports in 2012-13 rose 14.3% to 5.246 mt, according to official data. Exports form a small part of India’s total annual steel production of 78 mt, but are significant given the big plans for capacity expansion by all top companies that hope to cater not just to the domestic market but the neighbourhood as well.
Apart from this, rising imports of cheaper steel from China and increasing competition from foreign companies such as South Korea’s Posco and Japan’s Nippon Steel and Sumitomo Metal Corp.and JFE Steel Corp. that are entrenching themselves in India, mean local firms have to gain markets outside the country.
Tata Steel in strategic tie-up with Labrador Iron Mines
Tata Steel Ltd, India’s largest private sector steel maker, said on Tuesday that it has entered into a strategic tie-up with a Canadian iron ore company Labrador Iron Mines Holdings Ltd(LIM), whereby Tata Steel’s Canadian subsidiary will get access to greater iron ore resources.