Indian steel industry emerges from COVID setback, demand green shoots seen: Indian steel industry witnessed a decline in steel output which fell by 12% y-o-y in CY’20 owing to reduced capacity utilization during the lockdown. Domestic iron ore supply shortage pushed up the prices to record high levels on the delayed resumption of auctioned leases in Odisha. However, with easing of lockdown measures and pent-up demand from the auto & construction sector, mills ramped up capacity utilization to over 90-95% towards year-end from 30-40% in Apr’20.
- Auto sales dropped by 21% to reach 17.07 million units in CY ’20: Pandemic slowed down the economic growth of India resulting in sluggish auto demand, consequently posing a y-o-y dip of 21% in auto sales.
- Crude steel production dropped by 12.3% to reach 95.6 mn t: Reduced capacity utilization during lockdown lowered output.
- Steel exports rose by 44.2% to reach 17.3 mn t: Subdued downstream demand amid pandemic & active Chinese buying boosted exports from India.
- Steel imports declined by 40% to reach 3.9 mn t: Higher landed cost limited imports to India.
- Iron ore production fell by 15%: Delay in the resumption of auctioned mining leases in Odisha impacted production. India’s total iron ore production fell by 15% y-o-y to 200 mn t in CY’20.
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