May 11, 2012 (Bloomberg) - MOIL Ltd. (MOIL), India’s largest producer of manganese ore, increased prices after five straight quarterly declines on expectation demand for the steelmaking material will rebound as lower interest rates spur spending.
The state-run company, which supplies 40 percent of India’s manganese demand, raised prices by as much as 12 percent for the three months ending June, Chairman Kumar Jitendra Singh said today by phone. Manganese helps strengthen steel.
India’s steel demand is expected to expand 8 percent in the year ending March 31 from 5.5 percent the previous year, as declining interest rates fuel purchases of homes, automobiles, appliances and stimulates government spending. Steel Authority of India Ltd. (SAIL), which consumes almost one-quarter of MOIL’s production, plans to increase capacity by 55 percent to 21.4 million metric tons this year.
“We are seeing demand for manganese ore returning after more than a year,” Singh said. Prices had plummeted about 33 percent in the previous year, he said.
MOIL shares fell as much as 1.4 percent to 251.50 rupees and traded at 254.95 rupees as of 10:39 a.m. in Mumbai. The shares have gained 12.5 percent this year, compared with the 5.8 percent increase in the key Sensitive Index.