NEW DELHI (Commodity Online): Top steelmakers of India witnessed their sales soaring by 50% in December from a year ago.

The strong numbers by companies like Steel Authority of India (SAIL), India’s largest steel company, and rivals JSW and Ispat also lend credence to the economic recovery gathering momentum.

The pent-up demand from the automobile and infrastructure industries as well as the low-base factor — sales in December 2008 were subdued due to the downturn — made it a staggering year-end for steel companies.

SAIL reported a 32% growth in sales at 1.3 million tonne in December from a year ago, the company said. The state-run company’s sales in the third quarter ended December 2009 grew 23% from a year earlier due to an increase in products consumed by the construction industry. SAIL has a market share of around 25%, producing around 13 million tonne of steel every year.

JSW posted a 50% jump in sales from the year before. Demand for construction-grade steel, which slumped in August 2009 due to the monsoon, picked up again in the last quarter not just in India, but also other big markets like China and Japan. Overall steel usage in India is estimated to rise over 12%, compared with the global demand of 9.2% in 2010. That will be a far cry from December 2008 when steel demand was battered by the global slowdown forcing most steelmakers to cut production by 50% or more.

According to industry watchers, steel consumption is likely to shoot up further as companies stock up the commodity expecting a price hike.

And steel prices have risen $30-40 per tonne to $580 a tonne globally in the past one month alone. Steel products in the domestic market are currently selling for Rs 32,000-34,000/tonne, marginally higher than the landed price of imported steel.

Sales of Mumbai-based Ispat Industries, which produces 3.4 million tonne of steel annually, were helped by strong demand from the auto sector.

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