In the first half of FY25, India found itself as a net importer of steel, with imports reaching 4.7 million metric tons, marking a substantial increase of 41% year-on-year. In contrast, the country’s steel exports plummeted to 2.3 million metric tons, a decline of 36%. This shift has raised concerns, particularly as imports now exceed exports by more than double, with a notable import figure of 2.4 million metric tons compared to exports. This data was highlighted in an internal report from the Union Steel Ministry, which sheds light on the evolving dynamics of India’s steel market.
To understand the current situation, it is essential to consider the previous year's performance. In the corresponding period of FY24, India was a net exporter of steel, with imports at 3.3 million metric tons and exports at 3.6 million metric tons, resulting in a net export surplus of 0.3 million metric tons. The recent reversal in trade balance indicates a significant shift influenced by various factors, including global market conditions and domestic demand.
he surge in imports has been largely attributed to increased pressure from countries like China and Korea. A Ministry official noted that while there is ongoing pressure from these nations, the growth rate of imports has remained manageable, showing only low single-digit increases on a sequential basis. The official also pointed out that there has been a marked improvement in exports compared to previous months, hinting at potential stabilization in the market.
In September alone, finished steel imports reached approximately 1 mt, representing a staggering 78% increase year-on-year, although this figure remained consistent with August levels. Conversely, exports for the same month stood at 0.4 million metric tons, reflecting a 16% increase over August but an 8% decline compared to September 2023, when exports were recorded at 0.43 million metric tons.
A detailed analysis of steel categories reveals that non-alloyed steel, which includes products like hot rolled and cold rolled coils, experienced a remarkable over 55% year-on-year increase in the first half of FY25, totaling 3.5 million metric tons. In September alone, imports of non-alloyed steel surged by 95% year-on-year to 0.7 million metric tons, although this was a slight decline of 3% from the previous month.
On the other hand, imports of alloy and stainless steel reached 1.2 million metric tons, reflecting a 13% year-on-year increase for the first half of the fiscal year. In September, this category saw imports of 0.3 million metric tons, marking a 44% year-on-year increase and a 20% rise compared to August.
Despite the challenges posed by rising imports, domestic steel demand remains robust. Consumption has increased by 14% year-on-year, reaching 73 million metric tons, compared to 64 million metric tons in the same period last year. This strong demand is supported by a 5% year-on-year growth in finished steel production, which totaled 71 million metric tons for the first half of FY25. Notably, private sector steel production grew by approximately 6%, accounting for around 86% of the total steel output in the country.
