Steel intake up 5%, cement despatches see 12% rise in Q1

Chennai: The green shoots of the March quarter didn't die. Rather they grew up to signal a clear economic recovery in the second quarter. Steel and cement consumption—an important barometer of economic activity—kept its March quarter momentum on the back of robust infrastructure demand.
    For the quarter ended June 30, finished steel production went up by 3.4% to 13.98 million tonnes compared to 13.53 million tonnes during the same period last year. Consumption of finished steel was up by 5.2% from 12.2 million tonnes during Q1 of this fiscal to 12.83 million tonnes in April-June this year. However, on the exports front, April-June 2009 quarter witnessed a decline of 1.032 million tonnes to 0.642 million tonnes recording a fall of 37.8% while imports also fell 5.3% from 1.493 million tonnes to 1.414 million tonnes, according to data released by the ministry of steel.
    Meanwhile, cement production during the April-June quarter was up by 12.43% (501.33 lakh tonnes), while despatches increased by 12.26% (498.34 lakh tonnes) as compared with April-June 2008 quarter.
    "The macro-economic outlook looks better now than what it was sometime back. There are still some sectors like the export oriented units and finance dependent businesses which are yet to taste economic recovery and on the contrary are still feeling the heat of global economic meltdown,'' said Naresh Thakkar, managing director of credit rating agency ICRA.
    "It might take little more time for these sectors to see recovery signs. We anticipate that Q3 and Q4 of this fiscal could see the pick up in investment demand,'' he said.
    According to Pinakin Parekh of JPMorgan, "June 2009 despatches grew 13% year-onyear. We believe a benign base, combined with strong demand in north and east India, was the key reason for the strong year-on-year growth.''