India’s crude steel production in the April-September 2024 period increased by 3.6% to 73 million tons, despite production cuts implemented to manage supply and demand dynamics. Production cuts, particularly in January and February, helped maintain supply levels until April, after which the restocking phase began.
During the same period, steel consumption increased by nearly 13% to 73 million tons. However, sluggish domestic demand, rising imports, and falling exports weighed on this growth. While buyers generally procure on a need-based basis, there was a significant slowdown in orders from government projects. Exports fell by 42% to below 3 million tons, primarily due to competitive prices from China. This forced Indian steelmakers to temporarily withdraw from the market.
On the other hand, imports increased by over 51% to 5.4 million tons. Falling global prices made foreign steel more attractive. Prices also saw a sharp decline; the Indian Steel Composite Index fell by 6% y-o-y. This reflects the challenges faced by the sector amidst declining domestic demand and increasing competition.
Looking ahead, domestic demand is expected to improve in the second half. However, it is emphasized that pricing strategies need to be taken into consideration to prevent a resurgence in imports. The government aims to mitigate this by limiting imports of non-domestic steel products.
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