Released on = March 17, 2007, 4:38 am

Press Release Author = Shushmul Maheshwari

Industry = Industrial

Press Release Summary = Rising nickel prices and recently introduced duty changes
are raising the worries of Indian stainless steel manufacturers, as soaring prices
will hit their profit margins badly.

Press Release Body = A top industry official reported on January 31, 2007 that
burgeoning global prices of nickel together with recently introduced reduced duty on
a variety of finished metals would shrink the margins of Indian stainless steel
manufacturers.

N.C. Mathur, President, Indian Stainless Steel Development Association, informed
Reuters that a rise in nickel prices from $26,000 per ton in 2006 to $36,000 per ton
had shocked the industry. Changes in duty of a number of commodities by the Indian
government as a part of the move to check the rising inflation will make the imports
more competitive, thereby adding to the manufacturing firms’ woes.

Mr. Mathur says, “Customers don\'t want to accept high prices in Asian markets and we
have to absorb the price. That will hit the margins in the current quarter
(January-March). The previous two quarters have been good\".

The nickel industry has been responding to the news of disruptions at manufacturing
sites and at inventory levels. A threatened strike at Xstrata, a major nickel
producer in Canada that accounts for a mere over 4% of the global smelting capacity,
has taken the prices higher.

About two-third of the total nickel output (world) is used in the manufacturing of
stainless steel, and the industry demand is projected to surge by 7.5% this year.
Almost 70% of the stainless steel products manufactured by Indian makers have a
nickel content at a low 1-4%, but the price hike would still affect them greatly.

\"One percent nickel accounts for $400 per ton in the final cost of making stainless
steel at current nickel prices. So it is still very expensive,\" said Mathur.

RNCOS report “Nickel Market Outlook (2007)” observes that nickel demand has risen
with the rising prices of nickel scrap. The growing nickel demand is mainly
attributed to the mounting demand for stainless steel. The supply-demand gap for
nickel is widening with limited supply and growing demand. Considering the current
situation, the demand-supply equation is anticipated remain out of balance till
2010. Moreover, market risk factors, like labor unrest, strikes, feed shortages,
adverse weather conditions, slow restarts, and extended maintenance, would further
restrict the supply side.

About RNCOS:

RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of
industry experts who analyze data collected from credible sources. They provide
industry insights and analysis that helps corporations to take timely and accurate
business decision in today\'s globally competitive environment.

For more information visit: http://www.rncos.com/Report/IM086.htm
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Contact Details = RNCOS
Shushmul Maheshwari
Head of Business Development
29, 1st Floor, Patparganj Industrial Area, Delhi 92
91-11-4214-1229
info@rncos.com