The Hindu Business Line : RBI indent may help Salem Steel end blanking drought

Coimbatore, Sept. 7 The sudden disappearance last year of two rupee coins made of copper nickel alloy and the suspicion that these were being melted for their metal content has thrown a window of opportunity for the Salem Steel Plant of SAIL.

Officials of the plant see in the Reserve Bank of India’s recent decision to mint coins of all denominations in ferritic stainless steel (FSS), finally ending a drought in order bookings for the unit’s coin blanking plant.

The RBI, which did not replenish coin indent for mints during the past two years, in view of the comfortable coin stocks situation chose to restart indenting for coins. There was a sudden spurt, towards the end of last year, in the demand for Rs 2 coins.

The higher demand for the cupro-nickel Rs 2 coins is attributed to large scale disappearance of these coins in the wake of rising metal prices.

The intrinsic value of copper and nickel in them was perceived to be of greater value than the nominal value of rupees two that the coin is worth.

Their disappearance from circulation forced the RBI to switch to FSS coins.

The RBI, which in December last placed indent for 700 million pieces of Rs 2 FSS coins, has increased it to 1,500 million pieces for this denominated coins along with 500 million pieces of Re 1 coins and 300 million pieces for Rs 5 coins, all to be supplied for 2007-08 fiscal.

SSP sees it as a new opportunity to revive its coin blanking potential as the RBI raising FSS coin indenting would mean more work orders either in the form of a direct jobbing for blanking or at least, a higher off-take by the RBI owned mints, of the FSS strips, which is the raw material, according to Mr P.M. Subramanian, Executive Director of SSP.

FSS strips supply from Salem Steel Plant which has orders to supply 10,000 tonnes of FSS strips during current fiscal as against 3,281 tonnes of FSS strips supplied last year.

Supply from Salem Steel Plant which has orders to supply 10,000 tonnes of FSS strips during current fiscal as against 3,281 tonnes supplied last year.

Of the 10,000 tonnes, the plant had already supplied 6,000 tonnes of FSS strips so far this year.

More Stories on : RBI & Other Central Banks | Metals

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Sub-prime fallout: Beyond stock markets

RBI Annual Report 2006-07: Pragmatic remedies to sustain growth

Rupee gains on dollar inflows

Forex kitty down $2 m

HDFC hits all-time high

Volatile capital flows pose challenges: Reddy

Financial Tech training centre

Foreign banks looking beyond metros

RBI indent may help Salem Steel end blanking drought

Centurion Bank to focus on NRIs in Kerala

HDFC, Fidelity pick Corp Bank stake in NSE

Bond yields down 3 bps

‘Banks cautious on weak borrowers as NPAs rise’

T-bills auctions

Call rates steady

Bank strike on Sept 12