Demand for steel is improving rapidly, especially in construction, Dilip Oommen, CEO of ArcelorMittal Nippon Steel India said in an interview to CNBC-TV18.

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He does not expect steel prices in India to fall much from current levels because of China going slow on steel exports.

Concerns of weak steel prices caused a meltdown in stocks of Indian steel companies last week, but the fears appear to have faded, going by the rebound in share prices.

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Oommen said China has vacated its dominant position in steel exports, and due to a curb in exports from China, steel prices were unlikely to decline.

He said prices corrected by about Rs 3000 per tonne in August, but that was seasonal.

Despite Oommen’s positive outlook on steel prices, there are risks of increased supply.

Oommen said that China has overproduced during the first half of the year and so it needs to cut out in the second half.

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Metal analysts say the looming economic slowdown in China and strong demand for steel may force the government to review its production cuts for the remaining half of this year. China had cut back on steel production mainly meet its targets for reducing carbon emission.

Back home, Union Steel Minister Ram Chandra Prasad Singh last week said the government was looking to increase steel production to meet additional demand, and in the process lower steel prices.

For the full interview, watch the accompanying video.

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(Edited by : Santosh Nair)

First Published:Aug 30, 2021 12:37 PM IST