NEW DELHI (Commodity Online): Riding on a strong demand rise in 2010, steel makesr in India posted around 30 per cent rise in steel sales in january.

Companies like JSW, Essar and Ispat began the year on a strong footing with up to 30% growth in sales volume in January over the year ago period boosted by robust demand from automobile and consumer durable sectors.

The rise in construction activities, too, fuelled volume growth for the metal, thereby indicating that recovery in demand is broad-based and is gathering pace. After being hit by the economic slowdown that forced some steel producers to cut production in October-December 2008 due to low demand, steel consumption had grown 8% in the first nine months of the year ended December 2009.

Ruias-owned Essar Steel posted 20% growth in sales volume in January 2010. Ispat Industries sold around 2.5 lakh tonne of steel last month, growing more than 30% over January 2009.

Automobiles and consumer durables witnessed healthy growth, fuelling demand for steel products.

Rise in demand has already started reflecting in increase in metal prices both in India and abroad. Most steel companies increased product prices by up to Rs 2,000/tonne to Rs 33,000-35,000/tonne in the domestic spot market in January in line with international prices but restrained from any price hike this month. Globally, prices have more or less stabilised to $575-600/tonne after touching a low of $450/tonne early last year.

Price of steel in China declined marginally in the last few days after moving up 20% since October 2009, as inventories piled up and concerns grew that the government may curb lending to the industry in general.

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