Author Archives: Sohrab Darabshaw
India

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After a period of negative news following the COVID-19 pandemic, there’s finally some cheer for India’s steel industry, particularly related to Indian domestic steel demand.

Domestic steel demand has bounced back to pre-COVID levels. Automotive and white goods sector demand have driven the steel demand recovery.

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Indian domestic steel demand recovers

As per a report by financial firm Motilal Oswal, higher steel prices and lower coking coal prices ensured Indian primary steel producers’ margins remained strong. In addition, the report noted there were signs of domestic steel demand recovering gradually in the country.

The Motilal Oswal report also pointed out that India’s finished steel consumption, too, is recovering gradually. India’s finished steel consumption registered a drop of as much as 85% year over year in April 2020.

Chinese demand boosts Indian steel

What’s more, a renewed demand in the largest steel consuming market in China also boosted the bullish steel market in India.

Steel trade data by China shows demand remains strong there. China’s net steel exports declined to 10-year lows in September 2020. In addition, China saw a spurt in passenger car sales in September.

Because of these developments in China, its fallout was also seen in the Indian markets. Steel prices have also firmed up and have shown consistent increases over the last four months since July.

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India

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Some Indian experts are of the view that the U.S.’s newly imposed import tariff on aluminum sheet products, including on Indian aluminum sheet, will not affect Indian aluminum producers in a major way.

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U.S. slaps anti-dumping duty on Indian aluminum sheet, sheet from 17 other countries

Last Friday, the U.S. imposed fresh tariffs on U.S. $1.96 billion worth of aluminum sheet products from 18 countries, including India.

The U.S. imposed the duty after determining the goods were being dumped, according to U.S. Commerce Secretary Wilbur Ross.

“The Department’s aluminum sheet investigations constitute the broadest U.S. trade enforcement action in two decades,” Secretary of Commerce Wilbur Ross. “We look forward to receiving parties’ comments on the preliminary determinations that aluminum sheet imports from 18 countries have been dumped, and in some cases unfairly subsidized, into the U.S. market.”

Ross added tariffs were being immediately imposed even though the department’s reading was the dumping was preliminary.

“As a result of these decisions, Commerce will instruct U.S. Customs and Border Protection (CBP) to collect cash deposits from importers of common alloy aluminum sheet from the above-named countries based on the preliminary rates noted above,” the Department of Commerce said in a release announcing the preliminary determination.

In addition to India, the other countries on the list are: Brazil, Croatia, Egypt, Greece, Indonesia, Italy, Oman, Romania, Serbia, Slovenia, South Africa, South Korea, Spain, Taiwan and Turkey.

The U.S. petitioners in the investigation are the Aluminum Association Common Alloy Aluminum Sheet Trade Enforcement Working Group and its individual members.

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India

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India’s Commerce Ministry has launched an inquiry, based on a complaint by Indian steel players, to review the need to reimpose anti-dumping duties on certain steel products imported from at least seven countries, the New Indian Express reported.

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Reimposition of anti-dumping duties

A few months ago, India imposed duties on steel products imported from the U.S., China, Korea, European Union, South Africa, Taiwan and Thailand. With the duties, India aimed to safeguard Indian steel manufacturers from cheap imports.

However, the Commerce Ministry’s Directorate General of Trade Remedies (DGTR) launched a an anti-dumping probe. The investigation follows an application filed by Jindal Stainless Ltd, Jindal Stainless (Hisar) Ltd and Jindal Stainless Steelway Ltd. The “sunset” review covers imports of cold-rolled flat products of stainless steel, of width ranging from 600-1,250 mm from the seven countries.

Countries can impose tariffs on such dumped products to provide a level playing field for domestic manufacturers.

Dumping happens when a company or country exports an item at a price lower than the price of the one made in its domestic market. As such, dumping impacts the product price in the importing nation.

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India’s renewable energy sector, the fourth-most attractive renewable energy market in the world today, is all set to get a new player.

U.S.-based ArcVera Renewables, which specializes in consulting and technical services, has announced its entry into India’s solar, wind and hybrid energy storage market.

ArcVera has opened up an office in Bengaluru in the southern part of India. From there, it will deliver its expertise to project developers, lenders and investors — not only in India but also neighboring Southeast Asia and Pacific Rim countries.

The MetalMiner 2021 Annual Outlook consolidates our 12-month view and provides buying organizations with a complete understanding of the fundamental factors driving prices and a detailed forecast that can be used when sourcing metals for 2021 — including expected average prices, support and resistance levels.

ArcVera joins the fray in India’s renewable energy sector

The Colorado-based ArcVera Renewables has over 40 years of global experience. The firm is now providing expert technical, financial and independent engineering services for stand-alone energy storage or hybrid projects.

Gregory S. Poulos, CEO of ArcVera Renewables, told the Indian media a combination of factors had made the company take this decision to expand. He said, on the one hand, India is a large and rapidly growing renewables market. With the entry of energy tenders and hybrid project requirements, the country presents an even more complex and competitive market.

On the other hand, a competitor departure from the Indian wind market left a vacuum that ArcVera is ideally positioned to fill, Poulos added.

What also drove ArcVera’s decision is the fact that Indian developers and investors are on the lookout for technical expertise to lower project risk and raise project value.

ArcVera’s services cover the full project life cycle. That cycle includes: finance-grade resource assessments, project design, technology assessments, financing, M&A, due diligence, construction, operations and repowering.

The company has atmospheric scientists, engineers, and data analysts.

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China and India flags

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India turned a net exporter of steel to China (and other countries) during April-August 2020 for the first time in several years, credit rating agency CRISIL reported.

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India becomes net exporter amid domestic demand slump

Local consumption in India has slumped. As such, during the aforementioned period, Indian companies exported 60-80% of their steel output.

China accounted for 45% of the total steel exports, according to The Week.

“India turned net exporter of steel to China for the first time in several years, with 69% of semi-finished steel & 28% of finished steel heading there between April & August,” CRISIL said in a statement.

The rise coincided with border tensions rising between India and China, which led to clashes in India’s Ladakh region.

Chinese steel production, iron ore imports rise

China has been the largest producer of steel globally, followed closely by India.

In the January-June 2020 period, China’s steel production rose 1.4% to 499 million tons. Meanwhile, India’s production slumped 24.2% to 43.13 million tons.

The increase in exports, however, has eased the pressure on India’s steel sector. The sector has been buffeted by lockdowns and a major slump in economic activity because of the pandemic.

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hot rolled steel

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The Indian government has prepared a draft framework policy for the development of steel clusters in the country, Manufacturing Today reported.

Work on the policy, however, started sometime in late 2019 but ran into a hurdle because of the COVID-19 pandemic.

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Steel clusters to generate employment, increase value-added output

The idea behind setting up such clusters is twofold.

First, the government wants to increase production of value-added steel. In addition, it wants to generate employment.

India’s job losses are running into the millions because of the pandemic.

Minister of Steel Dharmendra Pradhan made the announcement of the draft framework policy in India’s Parliament. The minister said the policy will aim to set up of greenfield steel clusters, along with development and expansion of existing steel clusters.

‘Self-reliant’

The Press Trust of India quoted the minister, who said when the clusters are eventually rolled out, they would make India “self reliant” in value-added steel and capital goods.

Additionally, the clusters would generate employment, especially in the eastern part of the country, including the states of Chhattisgarh, Jharkhand, West Bengal, Odisha and Andhra Pradesh.

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India aluminum

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The Indian aluminum sector, which once stood firmly on the path of growth, today finds itself buffeted by the winds of uncertainty because of the COVID-19 pandemic.

Industry leaders have suggested many measures to the India government to put the sector back on track.

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Indian aluminum sector calls for removal of export cap

Uppermost on the list is a request to allow an export scheme for aluminum without any cap on the total exports.

The Engineering Export Promotion Council (EEPC) of India recently wrote to the Commerce Minister to continue with the Merchandise Export from India Scheme (MEIS Scheme) without any limit on the aluminum exports. The change would help the sector survive the current crisis situation, the Council argues.

Floated last year, the government trimmed the MEIS in the fiscal relief package recently extended to exporters. The government found it “unsustainable.”

The view is that, in general, the MEIS had failed to boost exports and capture new markets.

Critics argue MEIS cut hurts Indian aluminum sector

But experts, like Economics Affairs Secretary R. Gopalan, beg to differ.

Writing in the Financial Express, Gopalan said shrinking the MEIS had hurt the Indian aluminum industry, as the industry had to continue to rely on exports because of weak domestic demand. As such, so, the government had to support aluminum exports.

The only option left for the industry to sustain itself in these times of the pandemic is to export aluminum products, Gopalan said. As such, the decision to suddenly stop the MEIS, he felt, could have “a debilitating impact” on exporters’ ability to survive under current difficult conditions. Gopalan felt it would hurt exporters that work on long-term contracts.

Indian aluminum is one of the high-growth areas which could propel the nation’s GDP. However, the COVID-19 pandemic has already affected India’s aluminum exports. Export values declined 11% from U.S. $5.7 billion in fiscal year 2019 to U.S. $5 billion in fiscal year 2020. The new directive with regard to MEIS would render aluminum exports vulnerable and uncompetitive.

Mining group calls for import curbs

In parallel, the Federation of Indian Mineral Industries (FIMI) has urged the government to curb aluminum imports. Furthermore, the federation asked the government to facilitate the “tapping of rich and almost inexhaustible” domestic resources by local players.

Despite robust domestic demand and sufficient domestic aluminum capacity, India imported 60% of the aluminum it consumed. The result of this forex outgo, according to Vice-president R.L. Mohanty.

Domestic primary aluminum producers — such as Hindalco Industries and the Anil Agarwal-led Vedanta Ltd — are already working with the government at three levels: primary aluminum, scrap and downstream products. They have been asking the government to implement remedial measures, such as anti-dumping and anti-subsidy duties, the Business Standard reported.

Hindalco, the world’s largest aluminum rolled products manufacturer (especially in beverage cans and auto body), recently acquired Aleris. With this move, the company can now produce aerospace-grade aluminum sheets. It is also focusing on building capability in India to be part of the India growth story.

Meeting future aluminum demand

Domestic consumption of aluminum is expected to reach 10 million tons by fiscal year 2031-2032. To meet this future demand, India needs to increase bauxite production from 23 million tons in fiscal year 2019 to approximately 70 million tons by that time. Alumina production would have to rise from 7.4 million tons to 20 million tons.

India is No. 2 in the world in aluminum capacity. The country has primary aluminum capacity of 4.1 million tons per year and downstream processing capacity of 3.9 million tons.

Recently, the aluminum industry had made huge investments to increase domestic production capacity from 2 million tons per year to 4.1 million tons per year.

But experts fear that the COVID-19 crisis, coupled with the new government policies, could derail this growth story.

See why technical analysis is a superior forecasting methodology over fundamental analysis and why it matters for your aluminum buy.

India

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India’s steel production contracted since the arrival of COVID-19. However, exports surprisingly notched a new high in the April-July 2020 period.

Steels exports more than doubled in these months to hit their highest level in six years, reported news agency Reuters.

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Chinese demand soaks up India’s exports

Much of the Indian steel exports headed to China, despite ongoing tensions between the two nations.

China’s emergence as a new leading buyer of Indian steel has caught producers and analysts unaware. China replaces traditional importers like Vietnam, Italy and Belgium.

According to a China Iron and Steel Association official, it was paying particular attention to the imports of hot-rolled coils. The latter is used mostly to make pipes, automobile parts, and engineering and military equipment.

Indian production set to continue contraction

On the production side, a new report by Fitch Ratings has predicted further contraction in fiscal year 2021.

The ratings agency said higher prices supported by the price rebound in China will drive margins in the second quarter of the fiscal year and beyond. Hot-rolled steel sheet prices in China have improved by around $100 per metric ton since April 2020. Indian prices had started to tick up since late July, with a lag.

But the silver lining, according to Fitch, is that steel volumes could further improve over the next few quarters. Rural consumption and government spending on infrastructure would lead the improvement, and lead to better margins due to operating leverage.

On the exports front, Indian steel companies, like Tata Steel Ltd and JSW Steel Ltd, sold a total of 4.64 million tons of finished and semi-finished steel products in the world market between April and July. That total compares to 1.93 million tons shipped in the same period a year earlier.

Of the 4.64 million tons, Vietnam and China purchased 1.37 million tons and 1.3 million tons of steel, respectively.

Steel analysts here feel the exports jumped because of reduced prices as Indian sellers tried to get rid of a surplus generated by the impact of COVID-19 on domestic demand.

Analysts are also optimistic that with the Unlock 4.0 plan now announced, activities such as construction would increase. As a result, the plan would lead to an increase in local consumption, too. Overall, in the short term, exports would continue to grow over domestic consumption in India.

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India

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A team of researchers in India have introduced an eco-friendly and energy-efficient battery that is being touted as “the future” of batteries — not only for the automobile world but for drones and other tech gadgets, too.

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Researchers tout energy efficiency, cost savings

Researchers at the Shiv Nadar University and the Indian Institute of Technology (IIT) Bombay claim to have developed a technology for production of this eco-friendly lithium-sulfur (Li-S) battery. The researchers claim the battery is three times more energy-efficient and cost-effective than the Li-S batteries currently in use, the Hindu Business Line reported.

The Li-S battery technology deploys the principles of “green chemistry,” the Financial Express reported.

The technology incorporates the use of: byproducts from the petroleum industry (sulfur); agro-waste elements and copolymers, such as cardanol (a byproduct of cashew nut processing); and eugenol (clove oil) as cathodic materials.

The university said it decided to introduce the technology after five years of research by Dr. Bimlesh Lochab, associate professor in the Department of Chemistry. The university claimed the Li-S battery technology would be significantly cheaper and sustainable. while offering up to three times higher energy density and intrinsic flame-retardant properties.

For this research, Lochab’s team had tied-up with the IIT-Bombay team of Dr. Sagar Mitra, professor in the Department of Energy Science and Engineering.

New features

So, how is this battery different from what’s available on the market?

It synthesizes a bio-based molecule and also boasts of a new type of cathode for Li-S batteries. These developments can help push the promising battery technology to higher performance levels.

“The research will aid the production of cost-effective, compact, energy-efficient, safe and environment-friendly Li-S batteries, offering a viable alternative to lithium-ion batteries commonly used at present,” Shiv Nadar University said in an official release.

Sulfur in the battery comes from industrial waste. Meanwhile, the cardanol comes from bio-renewable feedstock.

In addition, the eugenol (derived from clove oil) copolymer is also environmentally sustainable, halogen-free and flame-retardant, all of which make the battery safe to use.

When this tech will be commercially exploited, this new Li-S tech-based battery will have a longer life and can be manufactured in very small units. That means those benefiting from it will include technologists who make gadgets requiring a power source.

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solar panels

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India will propose a World Solar Bank at the World Solar Technology Summit organized by the International Solar Alliance (ISA) in September, the Business Standard reported.

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The virtual conference by the India-headquartered ISA will showcase state-of-the-art, next-generation technologies to ramp up solar deployment affordably.

By the numbers

The likely capital size of the World Solar Bank would be U.S. $10 billion. ISA officials said the country that would request to host the headquarters of the bank would have to contribute 30% of the proposed capital.

“A global competition would be held among the member countries to decide who will have the bank’s headquarters,” the ISA official was quoted as saying by the Business Standard.

Indian Prime Minister Narendra Modi is likely to attend the inaugural event. In addition, along ministers from all ISA member countries and other R&D institutions from around the world would attend.

Summit topics

The summit will be divided into four technical sessions. Well-known companies and research organizations in the green energy space will present their work and deliberate on solar technology trends.

Topics will include, according to pv magazine:

  • Photovoltaic technology development and its future;
  • Recent advances, including conversion efficiency improvements and declining costs in PV modules and storage
  • Disruptive solar technologies for grid application – ground-mounted, floating or on residential and commercial rooftops
  • solar beyond the power sector

One of the aims of the World Solar Bank is to bring together global resources to fund solar power projects in ISA member countries.

The ISA came together in 2015 during the UN Climate Change Conference in Paris. The alliance, a partnership of solar resource-rich countries, currently has 121 countries as members.

Most of the participating countries are from Africa, Southeast Asia and Europe. Pakistan and China are not members of the ISA.

While speaking at the curtain raiser for the summit to be hosted by ISA next month, Indian Minister of State for Power R.K. Singh pointed solar energy is the future and technology would drive its down.

A few days ago, Modi reiterated the “One Sun, One World, One Grid” (OSOWOG) plan. The plan call for a transnational electricity grid supplying solar power across the globe, first announced in 2018.

M. Stanley Whittingham will deliver the keynote address.He will be joined by John B. Goodenough and Akira Yoshino. The trio won the 2019 Nobel Prize in Chemistry for the development of lithium-ion batteries.

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