Non-Alloy Steel Usage Set To Surge

Consumption of non-alloy steel is projected to grow by around nine per cent during 2001-02 as against 6-7 per cent in 2000-01. The projected demand for total non-alloy steel for the year is 28.92 million tonne.

From the period 1996-97 to 1998-99, the increase in consumption has been around 3 per cent, which increased to 4 per cent in 1999-2000 and then further to 6-7 per cent last year.

The steel ministry, on its part, is trying to promote steel usage in railway projects and highway construction. A high level meeting with representatives from the above sectors, steel producers and steel ministry, was held in Delhi recently to discuss how steel use could be promoted in these sectors.

According to sources, the growth in consumption is expected to come from infrastructure development, transport sector applications in automobiles, railways and light vehicles along with construction and packaging.

With regard to infrastructure development, demand for hot-rolled (HR) coils and skelp is expected to increase by 20 lakh tonne and cold-rolled (CR) coils and sheets by 2.5 lakh tonne.

Besides, manufacture of liquefied petroleum gas (LPG) cylinders is expected to absorb 2 lakh tonne of HR coils/skelp and 1 lakh tonne of HR sheets.

It maybe mentioned that according to the Rakesh Mohan Committee on infrastructure development, there exists a direct relationship between the gross domestic production (GDP) and construction sector.

For every one per cent increase in GDP, construction sector experiences a hike by 1.097 per cent and therefore, with a projected GDP of 6 per cent for the next fiscal, the corresponding growth in the construction sector is expected to be around 6.482 per cent.

Further, the steel ministry expects that the provisions laid down in this year's budget for housing sector will also enhance demand. To this end, GP/GC sheets consumption is expected to be around 2.5 lakh tonne and CR coils/ sheets, around 4 lakh tonne.

Complementary products being supplied by the fabrication units is also expected to rise. Government's proposition to supply electricity to large number of villages this year will also hike steel requirement.

Steel ministry sources also said that with the recent earthquake in Gujarat and the large-scale devastation caused by it, the government has stressed the need for quake-resistant constructions which again are necessarily steel-intensive. Use of steel as a scaffolding material is being explored for safety and longevity aspects.