Rupee Trades Marginally Lower At 67.91 Against Us Dollar

The Indian rupee on Wednesday was trading little changed against the US dollar in mid-day trading session.

At 2.14pm, the home currency was trading at 67.91, down 0.02% from its previous close of 67.90. The local currency opened at 67.90 a dollar and touched a high and a low of 67.84 and 67.99, respectively.

The Sensex index fell 1.4% or 329.96 points to 23,683.52 points. So far this year, Sensex fell 9.5%.

The yield on India’s 10-year benchmark bond was trading at 7.825% against Tuesday’s close of 7.838%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 2.6%, the worst currency in Asia, while foreign institutional investors have sold $1.8 billion from local equity and bought $457.40 million in bond markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 95.967, down 0.11% from the previous close of 96.071.

Most Asian currencies were trading higher. Indonesian rupiah was up 1.3%, Malaysian ringgit 0.87%, South Korean won 0.74%, Taiwan dollar 0.59%, Philippines peso 0.47%, Japanese yen 0.34%, Singapore dollar 0.32%, China offshore 0.19%, Thai baht 0.11% and Hong Kong dollar 0.05%.

Traders are cautious as the Federal Reserve chairman Janet Yellen will address the US Congress later in the session, for fresh cues and possible relief. Yellen is expected to defend the Fed’s first rate hike in a decade and is likely to insist that further rises remain on track, any signs of a departure from such a stance could provide risk assets with a breather, Reuters reported.

Source:- http://www.livemint.com

Domestic Cotton Prices To Stay Under Pressure In Fy17, Says India Ratings

Domestic cotton prices will stay under pressure in FY17 as volumes are unlikely to match Chinese demand, said India Ratings and Research (Ind-Ra). The rating agency has maintained a negative outlook on the cotton sector for FY17. The rating agency on Tuesday said the continuation of Chinese direct subsidy-based policy and lower demand from spinning mills will keep domestic cotton prices under pressure.

Though Bangladesh, Pakistan and Vietnam have replaced China with India as a supplier, volumes are picking up at a slow pace and are unlikely to match Chinese demand. The operating margins will stay in the 1-2% range for ginners and traders, but the profit after tax margins may improve as sector companies reduce stocks and focus on receivables management. International cotton prices, however, will remain sensitive to the release of cotton by China from its cotton reserves, which estimates to be around 59% of global cotton stock at FYE16.

According to Ind-Ra, Chinese cotton reserves will directly impact the quantum of imports in that country and consequently the global stock levels outside China.

The cotton industry is likely to revive moderately in CY17 as exports to Vietnam, Pakistan, and Bangladesh grow. Vietnam is likely to increase its spindle capacity by 30% in FY17. The local cotton production in Pakistan and Bangladesh is unable to keep pace with the increasing demand for apparels from these locations, providing opportunities to Indian exporters.

However, the report said that in view of China reducing imports significantly and the moderating demand from the Indian spinning mills industry, it is believed that the demand for cotton will increase at a marginal rate in CY17 and the prices are unlikely to increase materially from the current levels.
 

Source :.financialexpress.com

Remove Duty On Coking Coal, Auction Ore To Rescue Industry: Indian Chamber Of Commerce

NEW DELHI: Seeking Centre's intervention in rescuing iron and steel sectors, which are facing multiple problems, industry body ICC has demanded removal of 6 per cent duty on coking coal, including 2.5 per cent import duty.

It has also emphasised the need to ramp up iron ore production to meet the needs of steelmakers.

"A duty of 2.5 per cent was imposed on coking coal in 2014. This has increased the cost of steel making in India that is impacting the competitiveness of manufacturing steel products in India," Indian Chamber of Commerce (ICC) has said in a letter to Finance Minister Arun Jaitley.

Urging the finance minister to remove this import duty on coking coal in the ensuing budget, ICC said imports of coking coal had been without any duty for several years before 2014.

Also seeking removal of clean energy cess, the body said a cess of Rs 200 per tonne on coking coal equates to 3.5 per cent duty.

"Coking coal is different from thermal coal and the clean energy cess should be applicable only on thermal coal and not coking coal. Thermal coal is used for providing heat and during the process, the carbon burns and produces carbon dioxide and hence there is logic of imposing clean energy cess on thermal coal," ICC Director General Rajeev Singh said in the letter.

Singh added that coking coal is used for producing metallurgical coke and during the process no carbon is burnt and hence no carbon dioxide is produced.

"There is no substitute to coking coal as a raw material for production of metallurgical coke which is required for steel making whereas in case of thermal coal alternate sources of energy such as hydro, wind, solar etc are available," the letter said.

In a separate letter to Steel Minister Narendra Singh Tomar, ICC said the iron ore production needs to be ramped up to rated capacity of mine.

"In Odisha, against a capacity of 90 million tonnes per annum for captive mines, the annualised production rate for the current year is 50 MTPA," the letter said.

It also demanded that the entire ore production should be sold through auction to avoid hoarding saying, "The total stockpile of iron ore is approx 128 MT, out of which Odisha has a stockpile of approx 77 MT."

Demanding sale of stock through auction, the chamber has alleged the prices being quoted by mining companies are abnormally high and unviable for steelmakers.

Also demanding reduction of floor price to cost of production during e-auction of iron ore, the Chamber has stressed that there is a need to fix fair floor price as though steel prices have fallen drastically, iron ore prices have not fallen correspondingly.

Also, it urged the government to finalise a roadmap for auction of non-captive iron ore mining leases.

 

Source :economictimes.indiatimes.com

Govt Should Take Measures To Curb Chinese Aluminium Imports: Debnarayan Bhattacharya

Debnarayan Bhattacharya, managing director at Aditya Birla Group company Hindalco Industries, is steering the company at a very difficult time. The company’s stock is down 52 per cent in the past year due to falling aluminium prices. In an interview, Bhattacharya tells Dev Chatterjee and Aditi Divekar about Hindalco’s measures to ramp up productions at its new plants to curtail cost of production. Edited excerpts:

How big a damage is cheap Chinese aluminium imports causing to the Indian market. What are the steps the industry is taking to tackle this?

There are almost 750,000 people who are directly or indirectly engaged in the aluminium industry in the domestic market. So, it is important that the government takes some measures to curb Chinese imports in the national interest. The Aluminium Association of India has, therefore, made representation to the government asking them to raise import duty on the metal to 15 per cent from five per cent at present. Currently, of the total domestic demand, about 50 per cent is being met by cheap imports from China, which is hurting domestic producers.

How do you see Hindalco Industries’ cost of production going ahead. Is there any room to lower it further?

There are several steps we are taking to keep our cost of production lower going ahead. Our ramp-ups at Mahan and Aditya aluminium smelters and Utkal refinery are going superb as efficiencies at each of these plants are hitting desired levels. Moreover, coal prices have come down globally and so there is some benefit towards power costs, although it could have been higher if the rupee was stronger. Given that Coal India is to increase its production, supply is expected to rise and hence we see energy costs coming down. Alongside, Hindalco has shut 42 per cent of capacity at the Hirakud plant since it was higly inefficient and could have been a cost burden.

What is your outlook on copper and aluminium businesses? Can you give an update on your capex plans for copper segment?

Treatment-and-refining charges have come down for 2016 compared to last year and this will have a negative impact on the copper business in the coming quarters. However, we are planning to go ahead with our capex in this business where we plan to set up a copper rod unit, which is a value-added product. We are yet to arrive what the fund size would be for this plant. For aluminium, I think prices have bottomed out but cannot say how it would go from here. Premiums for aluminium, however, have seen marginal improvement.

What is your outlook for Novelis, which has shown operational improvement in December quarter?

Novelis’ performance is improving quarter-after-quarter as demand from the auto sector has exceeded expectations. Demand from the beverage industry is also looking positive and so in the coming quarters we expect Novelis to do better.

 

Source :.business-standard.com

Essar Oil Says “Advanced Talks” With Rosneft On; No Comments On Aramco Stake Sale Talk

MUMBAI: Essar Oil's is in advanced talks with to sell 49 per cent stake to Russian energy major OAO Rosneft but the deal is likely to take more time. The company's management declined to comment of media reports of a likely stake sale to Saudi Arabian Oil Co (Aramco).

Billionaire brothers Shashi and Ravi Ruia have agreed to sell a 49 per cent stake in Essar OilBSE -0.15 % to Rosneft, providing the Indian company an assured supply of crude while its Russian counterpart obtains a foothold in Asia's third largest economy. While the companies did not disclose the

 

Source :economictimes.indiatimes.com

Renault India To Export Kwid, Ramp Up Production

CHENNAI: French automobile maker Renault would start exports of its car Kwid to South Asian Association for Regional Cooperation (SAARC) countries and the car's parts to Brazil from March onwards and grow over 100 percent in the domestic market, a top official of the group's Indian subsidiary said.

The company would sell more than 100,000 units in the domestic market in 2016, launch a revamped Duster model and ramp up production of its car Kwid to 10,000 units next month, he said.

"Currently we are not big exporters of cars. But starting next month we will be exporting Kwid's parts to Brazil and completely built units (CBU) of the car to SAARC countries. We are also exploring African countries," Sumit Sawhney, country CEO and managing director, Renault India told reporters here late on Tuesday.

Without putting a number to export target, Sawhney said the company has also opened a parts distribution centre here where auto components are sourced and shipped out to Renault's other vehicle plants.

According to him car segment priced less than Rs.8 lakh is logging growth for the industry.

On Renault India's domestic plans Sawhney said the company is on target to have five percent market share by 2017 as the current market share is around four percent.

He said the company will not only expand its distribution network to 240 by 2016 end but also introduce a mobile workshop.

"The mobile workshop will be a proper workshop that can service around six cars a day. Our Lodgy car has been remodelled as a workshop. These vehicles can reach smaller towns for servicing," he added.
According to him, Renault India has over 100,000 bookings for its Kwid model and is the number two in its segment.

 

Source :timesofindia.indiatimes.com