Steel Authority of India Ltd expects domestic consumption to grow at least by 8-9 per cent in 2012-13, said the Chairman, Mr C.S. Verma

“Production is likely to grow by 7-8 per cent,” Mr Verma told reporters on the sidelines of Steel Summit 2012. State-run SAIL is the country's largest producer of steel.

“Demand is very good. It is difficult to say which way the prices move. The prices will be driven by demand-supply situation,” Mr Verma said replying to a query.

Tracking signs of a demand pick up in the last quarter of fiscal 2012, steel makers have hiked prices ranging from Rs 1,000 to Rs 1,500 a tonne. The prices of steel are expected to stay firm in the near term.

The World Steel Association in its recent short range outlook for this year has predicted a rebound in Indian steel demand. The association has forecast steel offtake to grow by 6.9 per cent to 72.5 million tonnes this year.

Steel off-take had turned sluggish in 2011-12 on reduced investments in infrastructure and construction. The demand stood at around six per cent last year.

For next year, the association expects the growth rate to accelerate further to 9.4 per cent on the back of urbanisation and surging infrastructure investment.

Tata Steel, another large player in the Indian market, also expects the domestic demand to grow by 8 per cent in 2012-13. “Based on the GDP growth forecast of seven per cent, the normal demand for steel should be around nine per cent. However, going by the pace of investments in infrastructure projects last year, we expect growth in steel demand at around eight per cent,'' the Tata Steel, Managing Director, Mr H.N. Nerurkar, said recently.

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