Fall in steel demand is a temporary phenomenon: Tata Steel

MUMBAI: Tata Steel today said the recent fall in steel demand following demonetisation of high-value currency notes is a temporary phenomenon, and is expected to become normal in next two quarters.

"The recent fall in steel demand post-demonetisation is a temporary phenomenon and is expected to become normal in next two quarters. It is a postponement of demand rather than vanishing of demand," Tata Steel MD T V Narendran told reporters on the sidelines of CII event here.

"The demonetisation move is good for the government and good for the country," he said.

Narendran added that in the long run the demand in parallel economy will flow back into the mainstream, benefiting organised steel producing companies.

The industry expects that the steel demand will be 5-6 per cent higher, while production will be 8-10 per cent as imports have come down, Narendran said.

However, he refused to give steel price outlook.