INDUSTRY OVERVIEW:

It is a well known fact that Ferro Alloys are critical intermediates in Steel making. With renewed resurgence in Steel Industry worldwide, the Ferro Alloy Industry is also back on a growth trajectory, after suffering prolonged depression. Though the manufacturing of Ferro Alloys in India, commenced much later than Steel, but this Industry has grown faster than Steel to make India self-reliant by late seventies. Thereafter, the capacity addition followed the course of planned target level of domestic Steel Industry and also to remain potential exporters of Ferro Alloys in the international market by earning substantial foreign exchange for the country. As a result, exports have increased from 15 % of the production in 1990-91 to over 35 % at present. Asia, being the largest producer of both Steel and Stainless Steel, India’s abundant natural resources and geographical position, have made India a potential global player to reckon with, in the field of Ferro Alloys.

In 2006, global Crude Steel production is estimated at 1239.5 million MT and global Stainless Steel production, is estimated at 27.8 million MT, and in regional terms, Asia is now the highest producer of both Carbon Steel and Stainless Steel, racing past the century-long European dominance. The focus is now gradually shifting to developing countries in Asia and Africa, following the potential consumption trends, predominantly due to the internal demand growth in China. It has been forecast that by 2010, Asia will achieve supreme dominance in both Carbon Steel and Stainless Steel production.

In the domestic front, both the Manufacturing and Service Sectors are growing at a healthy rate of 8 %. During the year 2005-06, Carbon Steel output was 41.66 million tonnes and Stainless Steel was 1.7 million tonnes.

Having vested its fortune on Steel Industry, the Ferro Alloy Producers have gained substantially during the last two years. 2004-05 and 2005-06 have been outstanding years in the history of Indian Ferro Alloy Industry. The Industry witnessed an all round growth, operational excellence and earnings. 
The Industry exported 0.5 million tonnes of Ferro Alloys and earned Rs 13,373 million during 2005-06. 

FUTURE OUTLOOK

India’s economy is doing better than many other nations and the outlook is good. India is moving up the ranks among countries of growing investor interest. With its fundamentals improving, India could achieve 10% growth on a sustained basis, provided an enabling environment is created through capital market reforms, labour market reforms and further trade liberalisation. 

According to Goldman Sachs of G S Global Economics, over the next 50 years, Brazil, Russia, India and China – BRIC economies – could become a much larger force in the world economy. If things go right, in less than 40 years, the BRIC economics together could be larger than the G6 in US Dollar terms. 

The country’s Steel demand is slated to expand and the Government has projected in the Eleventh Five Year Plan of 2006-07, that by 2011-12 the Steel capacity would reach 73 million tonnes.

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