India’s finished steel exports were recorded at 1.237 million tonnes (mn t) in May ’21, a growth of 30% month-on-month (m-o-m) against 0.951 mn t in Apr ’21, according to provisional data released by the Joint Plant Committee (JPC).
Higher realisations in the overseas markets and sluggish demand in the domestic market due to lockdowns in many states resulted in a surge in exports. The average monthly SteelMint HRCs (SAE 1006) FoB India index rose to $1,027/tonne (t) in May ’21 against $925/t a month back.
On a yearly basis, India’s finished steel exports saw a decline of 4% against 1.284 mn t in May ’20.
Finished steel imports up 8% m-o-m-
In May ’21, India’s finished steel imports increased to 0.39 mn t, up 8% m-o-m in comparison to 0.364 mn t in Apr ’21.
However, the same plummeted by 27% year-on-year (y-o-y) in comparison to 0.53 mn t in the year-ago period.
Imports are not viable at present due to increased prices in the global market.
Crude steel output up 3% m-o-m-
During May ’21, crude steel output was 8.52 mn t, marginally up by 3% from 8.30 mn t in Apr ’21.
However, Indian crude steel production edged up by 36% y-o-y against 6.26 mn t in May ’20.
The domestic steel output has been driven by increased exports and higher capacity utilisation levels than last year.
Finished steel consumption up marginally-
Indian domestic steel consumption was 7.280 mn t in May ’21, up by 1% m-o-m against 7.34 mn t in Apr ’21.
Meanwhile, India’s finished steel consumption registered a 52% y-o-y growth compared to 4.78 mn t in May ’20. Various hindrances in market activities owing to a stringent lockdown during Apr-Jun ’20 kept demand low.
Increased steel demand from sectors, including infrastructure, oil and gas, and automotive may drive the growth of India’s finished steel consumption in the near-term.
Outlook-
Partial lockdowns in pockets across the country in May ’21 may result in a subdued demand phase in Jun-Jul ’21 depending on the intensity of the third and fourth waves of Covid-19 in influencing domestic demand.
The export efforts in steel will most likely strengthen in the upcoming months with changes in Chinese policies which would make export offers higher. Also, the gradual opening up of major global markets and improvement of situation in India are expected to push up export growth further.
Therefore, it is the right time for the Indian steel exporters to widen their export basket and establish an export-oriented steel industry.
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