>STEEL SECTOR (GEPL)

World crude steel production saw some signs of recovery from its trough in the month of May-09. However, it was far away from the normal production level. Steel production in all major steel producing countries/continents increased 7% in the month of May-09 compared to the previous month (Apr-09). However, the production was down ~21% on YoY basis. Japan
(up 13.4%), EU (up 10.7%), US (up 10.5%) and China (up 7%) reported decent recovery on month-on-month (m-o-m) basis.

India and China were only countries among major steel producers which reported increase in steel production on YoY basis. During first five months of CY09, the world crude steel production was down 22.4% YoY led by US (-53%), EU (-44%), CIS (- 33%) and Japan (-42%). On the other side, China (up 0.4%) and India (up 0.5%) reported marginal increase in steel production during the same period.

Steel prices in major global markets were on downtrend in last one month except India. Steel prices in US and China fell by ~11% and ~8% respectively in last one month. Steel prices in India remained at the same level. Indian steel industry urged government to impose a safeguard duty of 25% on imported HR coil and other flat products due to higher imports. However, the government deferred to take any such measures for two months.

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