The traditional Indian buying and giving of utensils and metal mementoesduring the festival of lights and the wedding season that follows, tinkleswith the ring of silver for stainless makers at home.

It goes without saying that more 70 per cent of the stainless steelproduced in the country finds its way into utensils.

In other parts of the world (to take an international average) only 37 percent of stainless steel goes into the making of cutlery, tableware andutensils. Even forward-looking Jindal Strips, which is fast moving intovalue-added grades for industrial use, re-rolls 70 per cent of its threelakh tonne of annual stainless steel production for utensil-makers.

The Salem Steel Plant of the Steel Authority of India Limited (SAIL) evenhas a branded range of utensils.

The utensils industry's hunger for the shining alloy had not really abatedeven during the darkest phases of recession in the steel industry, since thedemand for utensils is somewhat related to population, which is a growingphenomena here.

Stainless prices, however, had dropped drastically and sales margins ofproducers had begun to flag.

The global recovery in demand and upward looking nickel prices have changedall that.

This festive-wedding season's buying spree (expected to pull on till April)coincides with a nearly 15 per cent growth in stainless steel prices athome. Prices of the lowest grade of stainless steel used in utensils havemoved up from Rs 28 a kilo to Rs 32 a kilo in the last nine months, which isa 14.28 per cent jump.

"Prices had bottomed out," said industry sources, explaining the quick andsteady recovery this year. Worldwide stainless steel prices have perked upby 25 per cent in the last nine months.

Stainless prices have moved up from $1200 (Rs 51,000) a tonne (free onboard) to $1500 (Rs 64,500) a tonne f.o.b, which explains the massive growthin exports.

Market leader Jindal Strips plans to export $18 million worth ofstainless steel by December, compared to $3 million in the whole of lastyear.

Jindal Strips vice president (corporate finance) Arvind Parakh said that in1998-99 only three per cent of the company's turnover (of Rs 1153crore) had come from exports, but this year overseas sales would contributeeight per cent of Jindal Strips earnings.

Jindal Strips is the market leader with a 40 per cent grip over the 6.5 lakhtonne stainless steel market.

Salem Steel re-rolls 50,000 tonne of stainless steel and has 10 per centmarket share within the country. Jindal Strips has plans of gobbling up itsclosest competitor, when SAIL puts it on the block.

The unorganised sector controls 16 per cent of the stainless steel market.The remaining 44 per cent of the market is shared by a motley crowd,including steel-makers like Mukand Steel (which also makes carbonsteel) Viraj Alloys and Panchmahal Steels. The bulk of the output of allthese stainless steel producers and re-rollers finds its way intoutensils-making.

Experts attribute the high stainless steel prices to the spurt in nickelprices. Nickel makes up 50 per cent of the cost of producing stainless steeland the mineral input has turned nearly 100 per cent dearer over the lastyear.

What is more important is the four per cent growth in the global grossdomestic product (GDP) in the first three months of1999-2000. The International Iron and Steel Institute haspredicted a 2.5 per cent growth in the world's steel consumption thisyear to 719 million tonne.

The consumption of stainless steel (which has weathered the storm muchbetter than the carbon steel industry during the years of fadingdemand) haspicked up in Europe and in Asia outside Japan. At home stainless steelprices are the strongest indicator of a spurt in demand and consumption.Stainless steel makers say inventories were depleting and sales were up.``Inthe Diwali-marriage season stainless steel demand is always up,'' said anindustry source, ``and this carries on till March-April.'' He pointed outthat the demand for the alloy also came from the white goods sector, whichalso gets a boost in sales from wedding bells.