NMDC sales connects to steel demand

Author: Paul Ploumis
06 Jan 2015 Last updated at 03:39:14 GMT
NEW DELHI (Scrap Monster): The recently seen flat trends in the steel industry seem to have had an adverse effect on the iron ore sale of the company, along with that, the iron ore imports have also been noted to be increasing, and the price of the commodity in the global market also continues to decline. All these factors might have affected the sale of iron ore in the company.

The steel production in India has been declining due to the weak demand for the commodity, and in the mo9nth of November last year, the demand of steel in the country has only risen  by 1.3 percent, according to the data published by the government officials. During the period of April-November, the production steel in the country had increased only by 2.2 percent. In the Index of Industrial Production, the steel index component, had hiked by about 1.3 percent, and this data singals a weak trend, which has been following the industry since the month of September.

Even the decline in the price of iron ore has not helped the company, to restore its sales of iron ore. During the month of December, last year the selling price of iron ore lumps was noted to be 66.83 dollars, which is 8.7 percent lower than the price of the commodity in the month of September, the same year. The price of iron ore fines had been noted to be 3.2 percent lower in the month of December, when compared to the price of  the commodity in the month of September.  The decline in the output, will have an effect over the growth of sales when the results will be published, and also the declining price will also add to the company’s distress, which will have a huge impact on the royalties. Even so, a slight relief could be expected from the decline in the price of fuels, and its effect on the freight costs. But the biggest of all the problems is that, the global price of iron ore keeps on falling, and declined by about 50 percent, which made the import of the metals more and more attractive in the year 2014.