India’s Steel Trade Imbalance Deepens as Imports Surge 20% and Exports Decline 25% in 9MFY25
India continues to face a growing trade imbalance in the steel sector, with the country becoming a net importer of finished steel for the period from April to December 2024. According to an internal report from the Ministry of Steel, steel imports surged by over 20% year-on-year, reaching 7.3 million metric tons during this nine-month period. In contrast, the country’s steel exports fell sharply by 25%, totaling just 3.6 million metric tons, marking one of the lowest export figures in recent years.
Steel Import Surge: Non-Alloy and Alloyed Steel Lead the Way
Imports of steel products in the 9MFY25 period saw substantial growth compared to the previous year, where 6.0 million metric tons of steel was imported during the same period in FY24. The sharp increase in imports can be attributed to various factors, including domestic production constraints, higher global demand, and price disparities. Specifically, imports of non-alloy steel, which make up the majority of India’s steel imports, rose by 23% to 5.4 million metric tons, compared to 4.4 million metric tons in 9MFY24. Meanwhile, alloyed steel and stainless steel imports increased by 15%, reaching nearly 2 million metric tons compared to 1.7 million metric tons the previous year.
Despite this significant rise in imports, India’s export performance has been dismal. Exports of non-alloy steel plummeted by 27% y-o-y, from 4.2 million metric tons to 3.1 million metric tons. The decline in alloyed and stainless steel exports was less severe but still notable, with a 3% drop, from 0.6 million metric tons to 0.5 million metric tons.
As a result of this imbalance, India remained a net importer of finished steel, with imports almost double the country’s exports during the 9MFY25 period. This trend has raised concerns within the steel industry, as it highlights the country’s reliance on foreign steel, despite being one of the world’s largest steel producers.
During the last quarter of 2024, India’s imports showed signs of flattening. For example, December imports were around 0.76 million metric tons, almost identical to November’s levels of 0.75 million metric tons. Imports had peaked earlier in the year, with the highest monthly levels recorded between August and October, reaching as high as 1.07 million metric tons in October.
On the other hand, exports have been relatively stable, fluctuating between 0.4 and 0.45 million metric tons per month. December saw a modest 12% sequential increase in exports, rising from 0.40 million metric tons in November to 0.45 million metric tons. However, these export levels are still below the peak reported in April, where exports reached 0.51 million metric tons, the highest monthly figure for the fiscal year.
Domestic Demand and Steel Production Growth
Despite the drop in exports, domestic demand for steel has remained robust. According to the Steel Ministry report, finished steel consumption in India for the 9MFY25 period stood at 111.25 million metric tons, a growth of 11.17% compared to 100 million metric tons during the same period last year. This strong growth in consumption is reflective of the ongoing infrastructure boom in India, which has driven demand for steel in construction, transportation, and manufacturing sectors.
Steel production has also increased, albeit at a slower pace. India’s total finished steel production for the 9MFY25 period reached approximately 107 million metric tons, marking a modest 4% y-o-y increase from 103 million metric tons in the previous year. The country’s steel mills are working hard to meet the rising demand, but the production growth has been constrained by factors such as raw material shortages, price volatility, and high production costs.
