India's steel market situation 2

As stated in the last passage India's steel market situation 1,We hold the belief India’s steel industry is with great potential because of India’s great macroeconomic growth potential and rich iron ore resources.However,the outdated infrastructure,poor coking coal resources and any other factors will hinder its development obviously.Following comes the hinder factors.
Firstly,India rely on importing coking coal whose net import reaches 13.95% to make steel in recent years.
Secondly,India’s weak infrastructure such as railways and ports,make the delivery cost of iron ore high.Besides,the outdated winning equipment is not good for the growth of the iron ore production capacity.
Railway: India's existing railway transport system still cannot satisfy the need of transportation of the steel and does not attract enough investment to update the tracks and establish new lines.All these unnecessary transportation costs will worse the relations among the raw material supplier,steel factory and consumption center region.
Highway;India still does not finish the highway construction that it plan to finish by the end of 20.05.It is obvious that radiation of the road transportation system is weak.
The current density index of highway in India is about 25%, and the highway concentrated outside the steel plant center.This restrict the development of local iron and steel industry seriously.
Port: Generally,the international benchmarks turnaround of containers round will take 24 hours, but in India's best ports such as JNPT and COCHIN port,it will take about 40 to 50 hours and in the common port such as CHENNAI port,it will take about 125 hours.Due to the the small port throughput in India, the iron and steel enterprises usually have to keep the high inventory of raw materials.If so,they should pay the high port demurrage charge of raw materials,which is bad for the transport circulation of the steel goods.
Power: the power sector in India is poor, low generating capacity, big frequency fluctuations,little parameters for equipment are conformable.Besides,due to electric leakage in the process of transmission,power loss is about 25% to 30%,many steel manufacturers have to install electrical equipment to generate electricity by themselves.This will lead to the unnecessary increase on the costs.
Thirdly,Indian steel manufacturers will meet with opposition from the rural leaders and lefties when they do site selection and plant expansion.
Fourthly,the India government adopt some measures to limit the price increase of the steel in domestic.And they prohibit the steel manufacturers to earn profits when exporting iron ore and allow the miners of iron ore and traders to export oversea,this aggravates a lot of steel manufacturers.
Fifthly,the frequent fluctuation of exchange rate on the foreign exchange market will inevitably affect the company's financial performance.
Guangdong Shunde Seko Machinery & Technology Co.,Ltd.
www.gdseko.com
Shelly
sales6@gdseko.com
Skype:lshelly520
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