[영문] Tata Steel Seeks to Triple Exports by Lowering Fuel Costs

Tata Steel Ltd. said it seeks to revive fourth-quarter earnings by lowering fuel costs and increasing exports in spite of its first quarterly profit decline in three years.

Third-quarter profit, excluding unit Corus, fell to 4.66 billion rupees ($95 million) from 10.7 billion rupees a year earlier, Tata Steel said today in a statement. Sales fell 5 percent to 447.4 billion rupees.

Managing Director B. Muthuraman told reporters today in Mumbai that the company has renegotiated lower coking coal rates for this quarter, without giving numbers.

Tata Steel plans to triple exports to 330,000 tons in the period as local demand wanes for hot-rolled coils, Chief Operating Officer H.M. Nerurkar said.

Steelmakers are struggling to pass on a tripling in coking coal prices to customers as the global recession keep consumers away from buying houses, cars and home appliances.

Long-term coking coal prices surged to $300 a ton, while iron-ore prices almost doubled in the year started April 1.

“Metal prices will continue to remain weak, so it’s a huge positive if Tata Steel has been able to renegotiate its coking coal rates,” said Pawan Burde, an analyst at Angel Broking Pvt. in Mumbai. “Fuel cost is the biggest worry for steelmakers.”

Earnings were eroded by a foreign-exchange loss of 1.27 billion rupees and raw material costs that surged 79 percent to 16.11 billion rupees, the company said.

Tata Steel mines its own iron ore and buys 40 percent of its coking coal, while unit Corus imports its entire coking coal and iron-ore requirements.

“Steelmakers globally are seeing an erosion in earnings as prices have slumped while costs have remained high,” said Bharath S., an analyst at Sundaram BNP Paribas Mutual Fund.

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