Dec. 8 (Bloomberg) -- India’s ferrochrome exports to countries including China and Japan may drop by a third in the next four years as domestic consumption gains, said Indian Metals & Ferro Alloys Ltd., the nation’s largest producer.
Exports may decline to 300,000 metric tons by 2015 from 450,000 tons expected this fiscal year, Subhrakant Panda, managing director of the Bhubaneswar, Orissa-based company, said in a telephone interview from New Delhi.
Global demand for ferrochrome, used to make steel resistant to corrosion, will outpace supply this year and next, according to Merafe Resources Ltd., part owner of the world’s biggest producer of the alloy. Stainless steel consumption in India, the world’s second-fastest growing major economy, is being driven by increased usage in airports, railway coaches and automobiles.
“The growth in stainless steel consumption here will be sharper than that of Chinas,” Panda said. “Higher demand locally would mean exports will fall over next four years.”
Total domestic consumption may reach 1 million metric tons by 2015, from about 450,000 tons, while output may rise at a slower pace of 44 percent to 1.3 million tons, leaving less ferrochrome for exports, he said.
Indian Metals, which owns a chrome ore mine in the eastern state of Orissa, expects to produce 200,000 tons of ferrochrome this fiscal year, Panda said. Eighty percent is exported to customers in Asia, including South Korea’s Posco, the world’s second-biggest maker of stainless steel, which has agreed to set up a ferrochrome venture with the Indian company, he said.
The world’s stainless steel production may rise 18 percent to 30 million metric tons this year and grow at a compound annual rate of 5 percent in the medium-to-long term, according to Merafe.
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