Stainless steel output grows 25%

Asian production (including India) of stainless steel amounted to 4.191 million tonnes in the March 2007 quarter, a growth of 25.2 per cent y-o-y, according to data recently released by the global industry body, International Stainless Steel Forum (ISSF).

Demand for stainless steel has come mainly from user industries such as construction and industrial applications, point out analysts.

Amongst Indian players, Jindal Stainless is one of the largest players and it is leveraging strong demand in the domestic market as well as neighbouring countries, by ramping up the company's stainless steel manufacturing capacity from 0.6 million tonnes to 0.9 million tonnes by FY09.

Global production of stainless steel grew 15.1 per cent y-o-y to 7.57 million tonnes in the March 2007 quarter, highlighted the industry body.

However, stainless steel companies have been grappling with the rising cost of key inputs such as nickel over the last few quarters "� this non ferrous metal is currently trading at $ 31, 900 a tonne on the LME as compared to $ 29,850 a tonne a year earlier.

To offset this situation, players such as Jindal Stainless have tilted its sales mix in favour of low-Nickel (200 series) stainless steel products, in a bid to keep operating costs under check.

In FY07, Jindal Stainless' consolidated operating profit margin grew 380 basis points y-o-y to 17 per cent.